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Official Positions of the Applicant Countries

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Official Positions of the Applicant Countries BULGARIA On 14 October 1999, the Prime Minister Ivan Kostov made a statement before the National Assembly regarding the European Commission's recommendations to open accession negotiations with Bulgaria The Prime Minister asserted that this is a crucial moment for Bulgaria because it implies the initiation of an accession procedure and the narrowing of the wide gap between Bulgaria and the first-wave countries. He expressed his content with the performance of the National Assembly and other state institutions in their efforts to harmonise Bulgarian legislation with that of Europe. Bulgaria had had to make tangible progress to meet the Copenhagen criteria, which the Prime Minister felt was now made. It is obvious that Bulgaria may not be capable of maintaining a highly competitive economy but Bulgaria does have a market economy. Bulgaria projects its prestige of a stable country, respecting the principles of democracy, rule of law and market economy. Mr. Kostov pointed out that if Bulgaria had not been supportive of the EU and NATO during the Kosovo crisis the country would probably have been isolated from the process of accession to the European Union. Bulgaria was expected at that time to show solidarity and support and contribute to this action, without which the European Commission would not have reached its positive decision to start negotiations. He then moved on to the important tasks and challenges that lay ahead for the country. Bulgaria has yet to build a strong and competitive market economy out of the present weak one (low incomes, low productivity, high prices, unsatisfactory quality) to meet European requirements. The Prime Minister emphasised some of the more specific matters involved on the way to European accession. As there are texts in the constitution that provide against Bulgaria's accession to the EU, the National Assembly has to discuss amendments to the constitution to allow accession to take place. The government is also faced with the problem of the Kozlodoui nuclear power plant. The Prime Minister, however, insisted that Bulgaria have no alternative path. The speed of Bulgaria's movement forward is becoming crucial for the survival of the country. At the Economic Forum for Southeast Europe in Sofia on 18 October 1999, the Bulgarian President Petar Stoynov gave a speech presenting some of Bulgaria's concrete proposals for regional co-operation. The President began by expressing a wish for the Forum to give fresh impetus to the actual implementation of the Stability Pact for SouthEast Europe. He also hoped it would represent a concrete step in support of the Pact. The President outlined some of the reasons for welcoming the creation of the Pact for SouthEast Europe. Bulgaria was among the countries hardest hit by the war in Kosovo as well as by the unsettled situation in former Yugoslavia over the past ten years. Bulgaria's main trade route to Western Europe to which more than 60% of its trade is directed has been cut off, including via the Danube. However, despite huge losses and difficulties, Bulgaria never abandoned the reform process. Even at the height of the crisis, the process of privatisation and closure of the loss- making enterprises continued and the government has continued to seek alternative routes for the country's exports and options for containing the damage. Mr. Stoyanov emphasised his full support of the Pact's political philosophy based on the "help for self-help" principle. He subscribed to its integral concept of unity of the processes of regional security and co-operation, consolidation of the democratic institutions and promotion of the civil societies in the region as well as its reconstruction and comprehensive economic development in perspective. This, he said, "is the rationale in maintaining that the economic development and prosperity of the countries of south-eastern Europe is the main guarantee of the irreversibility and sustainability of the processes in question. The steady course of economic reform and the increase in the living standards of the nations in the region is their governments' primary task and their societies' main incentive for integration with the western part of Europe". Abiding by the Stability Pact's philosophy, Bulgaria has been maintaining intensive bilateral, trilateral and multilateral talks and consultations on key regional projects. As an advocate of the idea of the European Balkans, the President presented some of Bulgaria's concrete proposals: - the countries of south-eastern Europe to pool their efforts in the priority development of a modern infrastructure and communications in the region; in addition to the transport corridors, special emphasis should be placed on the air terminals, ports, roads, power lines, oil and gas pipelines; - to encourage investment by putting together a system of guarantees, involving the governments concerned but also the major world and European financial institutions and, clearly and primarily, private capital; - to promote trade by radically improving the structure and organisation of work of the border checkpoints through free trade agreements, by declaring duty-trade zones and promoting programmes geared to small and medium enterprises, particularly suited to the whole region; - To involve local companies and manufacturers in the reconstruction and development of the region in one way or another, as suppliers, contractors or subcontractors. Finally, the President assured the Forum that Bulgaria would work towards the success of the Pact, to turn Southeast Europe into a zone of security and stability and an integral part of united Europe. On 19 October 1999, the Prime Minister Ivan Kostov gave a speech to the Economic Forum for SouthEast Europe regarding the path for more effective regional co-operation. The Prime Minister began his speech by mentioning the Commission’s recommendation to begin negotiations for accession to the EU. He expressed his belief that the European integration of Bulgaria was possible thanks to the development of regional co-operation, resolution of ethnic problems and the accelerated development of democratic institutions. Mr. Kostov went on to outline the specific problems that lie ahead for the governments of SouthEast European countries, such as the question of how to best use their limited resources to resolve the problems of security and development. The Prime Minister commented on the dynamics of the process of redistribution of capital, information and technological resources and the current significant disproportion between the movement of capital towards Central and Eastern Europe and towards the region of south-eastern Europe. It is clear that there is a regional problem with investment deficiency. In this respect, he reduction of regional investment risk and the increase in investment capacity is of vital importance. The Prime Minister appealed for a joint regional approach to manage this risk. The countries in the region should unite their efforts to create a regional system for the early diagnosis of crises and for the design, proposal and implementation of infrastructure projects in particular the construction of cross-border infrastructure. Companies, and in particular the large-scale private entrepreneurs, should be encouraged to develop strategies for regional development. The companies can and have to be interested in building regional business networks aimed at the realisation and placement of their produce, including to third markets. An expression of Bulgaria's resolve to move unwaveringly in this direction is the signed agreement for free trade with Macedonia. Bulgaria has a similar regime with Turkey and Romania and the EU association agreement is valid for trade relations with Greece. Mr. Kostov talked about the importance of defining the role of governments and companies - the construction of the so-called “soft infrastructure” concerned with the harmonisation of legislation, the limitation of corruption and bureaucracy, the levelling out of the conditions for business. In addition to this, the government has also undertaken the approach to gradually ease the tax burden. As from the year 2000, there will be a further 2% reduction in profit tax. In the context of common regional interests and the European integration process, Mr. Kostov talked about the need of the countries in the region to synchronise their actions and undertakings in relation to individual projects, including through the provision of direct and indirect guarantees outside the national segment of the project. There is a need for the mobilisation of internal resources, including regional resources. The international financial institutions have to be asked to design regionally oriented packages of services, which will include specific instruments for influencing economic agents. The Prime Minister stated that he realises that financial assistance from the international financial institutions from the developed states may play the role of catalyst at the first stage of renewal, but is hardly a basis or long-term factor for development. There is a need, in parallel with the expenditure of state resources, for the implementation of projects to create interest and attract private investment and companies in the region. Mr. Kostov concluded his speech by stating the necessity to define the regional framework of economic co-operation - a formulation of the priorities for development through regional projection of national programmes for development. The regional framework will be the main instrument
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