Bulgarian PM begins talks on how to improve business climate

Bulgarian PM begins talks on how to improve business climate


By Clive Leviev-Sawyer of The Sofia Globe

Plamen Oresharski, close to two weeks in office as Bulgaria’s prime minister, was scheduled to begin talks on June 10 2013 with business associations, trade unions, NGOs and representatives of protesters on how to improve the country’s business climate.

The series of meetings, to continue throughout the week, was telegraphed earlier when the head of the Bulgarian Socialist Party government said that he would discuss his “Plan Oresharski” with groups outside the government.

This plan includes reducing business licensing systems, speedy reimbursement of value-added tax, retaining the current 10 per cent flat tax rate on individuals and corporates, keeping in place the Currency Board that keeps the lev stable against the euro, lowering administrative taxes, creating a “ministry of administration and business climate”, increasing various forms of social assistance and raising the minimum wage in 2014.

Much of the “Plan Oresharski” is shrouded in vagueness, with items including “creating conditions for increasing the birth rate”, “increasing access to health care” and “increasing retirement pensions as soon as the budget allows”.

Against the background of the high electricity prices around which people were mobilised in early 2013, creating the political crisis that brought down the Borissov centre-right government and opening the way for the May elections, the plan provides for turning the State Commission for Energy and Water Regulation into a “truly effective watchdog” (after coming to office, the government changed the personnel of the commission) and there is an intention to freeze and later lower electricity prices – though again, how that is supposed to happen given that the regulator supposedly is independent remains unclear.

According to a government statement, Oresharski’s meetings will discuss three main topics – analysing the situation in the country and steps to improving conditions for doing business, alleviating and eliminating existing regulatory regimes and improving the Public Procurement Act.

Oresharski proposes creating working groups drawn from ministies, trade unions, employers’ organisations and non-governmental “experts”. These will review the regulatory systems and make proposals to ease them, the government statement said.

The Public Procurement Act will be reviewed so as to achieve greater transparency in procedures and equal treatment of entities involved in them.

The first two meetings on June 10 are, in the morning, with employers’ associations and in the afternoon, with trade unions. The government statement said that further details of meetings would be announced later.

Recently, Oresharski and his ministers have been painting a grim picture of the state in which they have taken over Bulgaria, portraying the country as in a state of virtual collapse with vital work not done, and they say that they have uncovered a concealed billion leva (500 million euro) deficit.

On June 9, the former deputy finance minister in the Borissov government, Vladislav Goranov, said that the supposed gap of a billion leva in the budget that the new government claimed to have found was a miscalculation, intended to decrease the “great expectations” of the new government and its election campaign promises.