issue 63 october 2005
AmChamAmCham Interviews:Interviews: RichardRichard Levick,Levick, USUS expertexpert inin PRPR Analyses: Yellow Cards, Red Boxes on Bulgaria's Road to EU Turkey in EU: The Long Winding Road After the Floods Tourist Season 2005
TheThe PRPR MarketMarket IsIs UpUp
American Chamber of Commerce in Bulgaria
Business Park Sofia, Mladost 4 Area, Building 2, Floor 6, 1715 Sofia Tel.: (359 2) 9769 565 Fax: (359 2) 9769 569 homepage: www.amcham.bg e-mail: [email protected] editorial
Dear Reader,
It is not an accident that the cover of the current issue features a typewriter and not a computer. Not that I have anything against technology - on the contrary, I love new electronic gadgets. PCs and Macs made journalists' life easier, and the Internet allows them to do even more from their desk - which made some Dear Members believe that you can work in the media without ever getting out and Friends, of your office. We have had quite a number of events Perhaps this is the reason why the article about the most successful PR practitioners this month but one of them turned up in Bulgaria reviews companies of people who have started working back in the type- to be of particular value to the partic- writer days (see Page 6). Top-level PR and journalism is - at least for now - dominat- ipants. The business lunch and the ed by those who have long professional and life experiences. presentation by Richard Levick of Levick Strategic Communications As you will see from our cover story, the PR market in Bulgaria is in ascendancy. If enjoyed an enormous positive you read the newspapers or watch broadcast news, though, you would not know that. response from all who attended. Mr. The government and various political figures, even large Bulgarian companies, try Levick is one of the most prominent PR repeatedly to weather various crises without an adequate reaction from their PR depart- and media consultants in Washington ments or consultants. Maybe some of them do not employ such consultants, or they these days, and it was this meeting don't heed the advice of professionals in such situations out of arrogance or ignorance. that actually inspired us to cover the topic on public relations in such Consider Sofia's recent 'waste' crisis, which undoubtedly will play into the mayoral elec- breadth for this issue. tions (see Page 16). Nobody from the capital's municipality PR department bothered to visit the villages near which dumps are located to explain the situation and negotiate a Media releases, public relations, devel- resolution. Deputies of the mayor and cancellers instead were life talking to the people oping promotional campaigns and instead of enjoying a good PR campaign. improving media contacts are all issues critical to the success of any business- Another crisis, this year's floods (see Page 32), was not handled much better. Many in es. The Chamber itself is aware of the Bulgaria's countryside remained under the impression that intentional draining of the fact that most local companies still levees led to waters swamping thousands of homes. Journalists have the task to inves- require significant guidance in this tigate who was responsible, but PR practitioners must be at hand to calm the populace respect. But even for the international and help it separate truth from rumor. companies in Bulgaria, it is of critical importance to develop their PR and The largest PR problem today is Bulgaria's seemingly faltering accession to the marketing skills. Whether it is about European Union (Page 26). Somehow, I am not under the impression that the govern- generating positive media coverage of ment has hired numerous top-professionals who are working diligently to boost the business activities, keeping the bad country's image. I attended recently a lecture by Wally Olins, the chairman of Saffron AmCham Bulgaria Magazine October 2005 news out of the media, or developing Brand, who said that the process of establishing the positive image of a country takes an effective public relations strategy, all at least 20 years. We have started recently - if at all - so can we expect this PR cam- such efforts should be considered as paign to conclude successfully by 2025? utterly important communication and management tools for any company. I start to worry even more reading Richard Levic's opinion (Page 11) that Bulgaria needs to establish a positive brand. The PR market may be going up, but as usual this obser- One of the Chamber's goals for the vation refers only to the private sector. Most foreign companies are well aware of the page future is to provide many more oppor- need to develop their public relations, so they pay a host of skilled professionals to do 1 tunities for sharing top-notch expertise exactly that. On the other hand, it seems that the image of Bulgaria as a country, here and skills in media communications and abroad, is promoted by people without sufficient expertise and experience. I bet and PR, which will give our member that most of them did not start their professional career in front of a typewriter. We organizations a competitive advantage. would be lucky if their practical experience dates back at least to Windows 98.
Sincerely, Sincerely,
Valentin Georgiev Milen Marchev, Executive Director Editor-in-Chief contents
issue 63 october 2005
AmCham Bulgaria Magazine is a primary forum for political and economic analyses, news, viewpoints as well as for the presentation of new business oppor- tunities. The articles in the AmCham Bulgaria Magazine express the opinions of the authors and do not necessarily reflect the position of the American Chamber of Commerce in Bulgaria.
Publisher Writers: American Chamber of Commerce in Bulgaria Boyko Vassilev, Marina Tzvetkova, Business Park Sofia, Mladost 4 Area Mina Georgieva, Panayot Angarev, Building 2, Floor 6, Sofia 1715, Bulgaria Yuliana Boncheva e-mail: [email protected] www.amcham.bg Advertising AmCham Bulgaria: Editor-in-Chief Nadejda Vakareeva, [email protected] Milen Marchev AmCham Bulgaria Magazine: Milen Marchev, [email protected] Deputy Editor-in-Chief: Christopher Karadjov The AmCham Bulgaria Magazine reaches a broad audience Senior Editor: of AmCham members, leading US, Bulgarian and internation- Irina Bacheva al companies, US and Bulgarian decision-makers, all AmChams around the world. Layout, Design & Printing: Subscription is free of charge. If you would like to subscribe Milen Marchev to AmCham Bulgaria publications, please contact the AmCham Bulgaria office.
2 AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria amcham bulgaria
Board of Directors of the American Chamber of Commerce in Bulgaria President Mr. Kenneth M. Lefkowitz NECA/Balkan Data, Inc. Vice President Mr. Stefan Dimitrov Allied Pickfords Bulgaria Contents Treasurer Mr. Anthony Hassiotis Bulgarian Postbank cover story Members Mrs. Olga Borissova AUBG Bulgaria's PR Market: Forward and Up ...... 4 Mr. Borislav Boyanov Borislav Boyanov & Co By Borislav Kandov, Capital Weekly Mr. Nick Davies Ernst & Young Bulgaria Mr. David Hampson Grenville Financial U.S. Professional Mrs. Tanya Kosseva Landmark Presents High-Stakes PR ...... 6 Mr. Friedrich W. Niemann Hilton Sofia Mr. George Randelov IBM Bulgaria interview Mrs. Elitsa Tsaneva Ideal Standard Bulgaria Richard S. Levick: Mrs.Maria Vranovska Eli Lilly and Company Bulgaria Must Establish Its Brand ...... 11 Ex-Officio Member Mr. James Rigassio US Senior Commercial Officer Executive Director: Valentin Georgiev By Irina Bacheva . . . . 3M (East) AG AA .KRES EOOD ABB Bulgaria. Ltd. . AbC.R.O. - Bulgaria. EAD politics Abrotea Bulgaria AD Accor Services Bulgaria . Acsior ACT. Soft Ltd. Address Sofia's Mayoral Election Bulgaria Holding JSCo.- A. real estate company. ADIS Ltd.. Advance International. Transport .(Balkan) EAD AES Corporation. AFA OOD. AIG Bulgaria AIG Life. Is Ripe With Suspense ...... 16 Bulgaria AIMS Human. Capital Alexandrov. Ltd. Allan Collautt Associates,. Inc. By Marina Tzvetkova Allied Pickfords Bulgaria Alter Ego Company American College of Sofia American Construction Products JSC . American English Academy . American University in Bulgaria (AUBG) . Amylum Bulgaria EAD . Anglo-American School of Sofia . Anton Preslavski, analysis Liebert Hiross . APIS - BULGARIA Ltd. . APOLO Ltd. . Aries Commerce . ARGEN- Economic Growth and Outlook ...... 25 TO Human Resource Solutions . Association of Bulgarian Broadcasters - ABBRO . AT Engineering 2000 Ltd. . AUDITING COMPANY VERSI & PARTNERS OOD . Avendi Ltd. . AVON Cosmetics Bulgaria Ltd. . Balkan News Corporation Plc. . Balkan Star . Yellow Cards, Red Boxes on BalkanData / Lefkowitz & Co. . Banque Internationale pour le Commerce et le Bulgaria's Road to EU ...... 26 Developpement (BICD) . Baxter AG . Bayer Bulgaria . BearingPoint Inc. . BG Radio . Bodyguard-Fire-K Ltd. . Borislav Boyanov & Co. . Braykov's Legal Office . Bristol- By Yuliana Boncheva Myers Squibb . Brown Forman Beverages Worldwide Sofia Branch LLC . BTC-NET Ltd. . Bulbank . Bulgarian American Enterprise Fund . Bulgarian Charities Aid Foundation Turkey in EU: The Long Winding Road ...... 29 (BCAF) . Bulgarian Post Bank . Bulgarian Telecommunications Company EAD . By Boyko Vassilev Business Media Group . Business Park Sofia EOOD . Business to Business . CA IB Bulinvest . CableTel . Car Rental Bulgaria Ltd. . Cefin Bulgaria EOOD IVECO . Chelopech Mining EAD . Center for the Study of Democracy . Cisco crisis management Systems Bulgaria . Citibank, N.A.- Sofia Branch . City University . Clockwork . CMS Cameron McKenna . Coca Cola H.B.C Bulgaria SA . Coca-Cola Bulgaria EOOD . COL- The Floods and After ...... 32 LIERS International . Commercial Bank Investbank Plc. . ConsulTeam Recruitment and By Marina Georgieva Selection Ltd. . Contex Drouzhba Ltd. . Corsa Logistics Ltd. . Corstjens Worlwide Movers Group . CPM International Ltd. . Curtis / Balkan Ltd. . David Hampson, Grenville . DeConi M&A . Deloitte & Touche . DHL International (Bulgaria) Ltd. . Diageo tourism Bulgaria Ltd . Dimitrov, Petrov and Co. . DIMON Bulgaria . Djingov, Gouginski, Records and Reforms in Bulgarian Tourism . . . . . 36 Kyuchukov, & Velichkov . Domaine Boyar AD . Dr. Emil Benatov & Partners . DynCorp International LLC . Effekten Und Finanz - Bulgaria EAD . Electron Progress AD . Eli By Mina Georgieva Lilly and Company . Elido (Lamel Ltd.) . Ellen Ruth Greenberg, Ph.D., Dr. I.S. Greenberg Medical Center . Elmek Spor Bulgaria . Elta consult AD associated partner of CB Richard committee reports Ellis for Bulgaria . Emerson Process Management AG . Encouragement Bank AD . AmCham Real Estate Committee to Lobby for Engineeringservice Sofia Ltd. . EQUEST EAD . ERATO HOLDING PLC . Ernst & Young Bulgaria . EURO RSCG New Europe Sofia . Expo Team Ltd. . First Global Health Amendments in Law on Term Leases ...... 39 Corporation . Flying Cargo Bulgaria Ltd. - Licensee of FedEx . Force Delta Ltd. . Forem Consulting Bulgaria . General Electric International . Genmark Automation Bulgaria . GEO - CAR Ltd. . Glaxo SmithKline . Goleminov & Goleminov . Goodyear Dunlop Tires entrepreneurship Bulgaria . Grand Hotel Sofia . Group 4 Securitas (Bulgaria) Ltd. . Hayhurst Robinson New Center Aims at . HEBROS Bank AD . Hewlett-Packard Bulgaria EOOD . Hilton Sofia . Honeywell EOOD . Horizon . IBM Bulgaria . Ideal Standard Bulgaria . In Time Ltd. . Infoguard Improving Business Culture ...... 40 - Stefan Nedkov . ING Bank Sofia Branch . Intel Czech Tradings Inc. . Interbrands Marketing & Distribution Inc. EOOD . Interdean.Interconex . IP Consulting Ltd. . ISI Emerging Markets (Internet Securities, Inc.) . Janssen-Cilag (division of Johnson & Johnson) member news . Junior Achievement Bulgaria . Kaliakra AD . Kamenitza AD . Kamor Auto Ltd. . AmCham Bulgaria Magazine October 2005 Soravia Opens New Business Center in Sofia . . . . 42 Kolbis International Transfer Corporation . KPMG Bulgaria . Kraft Foods Bulgaria . LANDMARK . Lexim Sofia Ltd. . Lindner Bulgaria OOD . Lirex BG Ltd. . Lowe Swing Communications . M & M Air Cargo Service BG Ltd . M3 Communications Group, Inc. A Ernst&Young: Hil & Knowlton Associate . Maersk Bulgaria Ltd. . Magnetic Head Technologies . Europe Still №1 Investment Destination ...... 43 Management Systems International . Maritza East III Power Company AD . Marsh EOOD . McDonald's Bulgaria Ltd. . Merck Sharp & Dohme IDEA Inc. . Meridian Hotels IBM's Business on Demand Aids Bulgaria. Microsoft Bulgaria . Miltech Ltd. . MobilTel AD . Monbat PLC . Moten Sport . Moto Pfohe Ltd. . Motorola Bulgaria EAD . National DISTRIBUTORS . NATO Companies Achieve Flexibility ...... 44 Defense College (NDC) . NDT Equipment Supplies LTD . Neterra Communications . Net Is Ltd. . NET IS SAT Ltd. . Neumann International AG . New Europe Corporate Advisory Ltd . Nexcom Bulgaria EAD . Opet Aygaz Bulgaria EAD . Oracle East Central Europe easteuro link Limited - Branch Bulgaria . Orbit Ltd. . ORKIKEM Ltd . Pain D'or Ltd. . Paxar Bulgaria. page Bulgaria to Speed up Reforms Pfizer H.C.P. Corporation, Representation Office Bulgaria . Pioneer Semena Bulgaria EOOD . Popov Legal Office . Pratt & Whitney . PricewaterhouseCoopers . Prima Soft Ltd. . 3 in the Energy Sector ...... 45 Procter & Gamble Bulgaria . ProSoft . PSG Payroll Services Ltd. . Radisson SAS Grand Hotel . Rising Force Co., Ltd. . Rockwell/Intelpack . S&D Chemicals Bulgaria . S&T Bulgaria . Sante International OOD . Schering - Plough Central East - Bulgaria . Sciant travel . SEAF Management Bulgaria EOOD . Seplex Law Offices . Sheraton Sofia Hotel Balkan South Africa's World Heritage Sites - Part I . . . . . 46 . Sherita M Ltd. . Sienit Ltd. . SigmaBleyzer Investment Group LLC . Sofia Echo Media Ltd. . Soravia Bulgaria . Stefan Dimitrov, Norman Management Co. Ltd. . By Gerhard Visser, Ambassador of South Africa to Bulgaria TechnoLogica . TeleLink AD . Tero Halmari, EBRD . The Atlantic Club of Bulgaria . The Executive Centre . Tissue Bank Osteocenter Bulgaria EAD . TM Auto Ltd. . TMF music . Tumbleweed Communications EOOD . Unimasters Logistics Group AD . Unisys Bulgaria Branch . Urban 3000 Ltd. . Vector Management Bulgaria . Via Expo Ltd. . Videolux The Top Fender® Females - Part II ...... 47 Ltd. . VOCA Consult Ltd. . VSK Kentavar Ltd. . Westinghouse Energy Systems Bulgaria By Snejanka Natcheva Branch . Wrigley Bulgaria EOOD . Xerox Bulgaria Ltd. . Zlati Dinev Studio . cover story
Bulgaria's PR Market: Forward and Up Borislav Kandov, Capital Weekly History seems to repeats itself. This is obviously a cliche, which for the big ones. The first two have already accumulated a sub- nevertheless fits perfectly the case at hand. Whenever we try to stantial experience and have the genuine chance to emerge as describe the PR services market in Bulgaria we could easily use market leaders. The All Channels team consists of young but the examples set by PR developments at their source, the United ambitious people who still have to demonstrate their full poten- States. Hence, this analogy would help forecasting the future of tial. PR in Bulgaria. At least, we should hope that Bulgaria will never be involved in a military conflict, which would boost this sector, These names however do not exhaust the names of the agen- as it happened in the United States during WWI and WWII. cies operating on the PR market.
Still, there are substantial differences. Yanev & Yanev is managed by the almost mythical Elena Valcheva-Yaneva. The term "mythical" is appropriate, as she does The formal debut of the PR profession in Bulgaria was made in not like to be in the focus of attention and prefers to work in 1993 with the establishment of the first Bulgarian PR agencies - obscurity. The company does not even have a website. During Yanev & Yanev and D & D Agency. However, academic PR pro- grams were launched as a pilot project by the New Bulgarian uni- versity two years before that, in 1991. The first generation of PR bachelors entered the market in 1992. PR services perhaps had been offered before 1993 as well, but in view of the political envi- ronment between 1989 and 1993, these services should be referred to the realm of open political propaganda, and today there are only a few people, who would even think about this period in their professional development. The main players
4 It is a logical development that the agencies, which were estab- lished before 1995 are currently the largest and the most influ- ential in this country. Yanev & Yanev, M3 Communications Group, D & D Agency, and MARC Holding (established in 1995, current- ly Publicis/MARC Group) are the leaders on the Bulgarian mar- ket. According to 2003 data, each of the four agencies had rev- enue of more than 1 million Leva. Elena Valcheva-Yaneva in the company of at least three Bulgarian financial min-
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria Of the newcomers, United Partners, APRA Porter Novelli, and All isters - Stoyan Aleksandrov (L), Milen Velchev, Plamen Oresharski (R) and one Channels Communication could be described as a real "threat" former deputy Minister of Finance- Dimitar Kostov. cover story
Bulgarian PR Agencies are doing great job in attracting media attention by organizing huge pr events and inviting famous politicians at the client's ceremonies. the tenure of the former government of the National Movement member of the board of that bank. Various other state institutions Simeon II (NMS), the services of Yanev & Yanev were used were and some of them still are clients of D & D Agency, as well mainly by then Deputy Prime Minister and Minister of Economy as Agrima (the Bulgarian representative of Pepsi Co. for Lydia Shuleva. The agency took over a major part of the cam- Bulgaria), Balkanpharma, and others. paign of Simeon Saxe-Coburg-Gotha for the parliamentary elec- tions earlier this year. Yanev & Yanev have managed in previous Crisis PR is one of the D & D Agency's forte, and it is only nat- years various projects for the Ministry of Foreign Affairs, the ural that none of the agency's team would venture to speak offi- Ministry of Labour and Social Policy, and others. Almost nothing is known by the public about the private clients of Yanev & Yanev (outside the fact that the company worked with McDonald's in 1999 and provided advertising services). This fact is indicative of the skills of the company's team. At the same time, it can be concluded that the Yanev & Yanev agency has accumulated a serious experience in political and crisis PR. Besides, politics is hardly among the "convenient" spheres of work.
D & D Agency is also managed by an lowkey personality. Lowkey in the sense that Diana Damyanova prefers to keep a low profile of her agency. LukOil is the oldest client of the agency, from the times when the company was still known as Neftochim. Damyanova has for quite a time already been a Diana Damyanova - head of D & D Agency. member of the company's management team as director of the cially and provide facts. Utmost confidentiality in contacts with internal PR department. The agency has often worked for busi- clients is listed as one of the principles of the agency, published nessman Slavcho Hristov and for EIBank, when Hristov was a on its website. Continues on page 8 AmCham Bulgaria Magazine October 2005
page 5 cover story U.S. Professional Presents High-Stakes PR said. Rarely is it understood that unfold- ing events can be modified with the right strategy. Probably 95 percent of the problems in the world are defined by the media first, and not by partici- pants, Levick added.
That is why it is crucial for a company to operate as a team in an emergency situ- ation. It is very important what kind of image the company's spokesperson cre- ates in the society because this is what remains in the people's minds, continued Levick. He added that usually litigation communications are not handled well in any industry in the world. In 95% of the problems in the world the media define it first, Levick stressed
Richard Levick, president of Levick Communications, presented to a captive AmCham audience on Oct. 6 the essence of high-stakes communications. He elaborated on the main rules of pen- etrating the American market and dealing with rigid competition. Among the AmCham guests who were willing to find more about state-of-the art PR were Assen Agov of the National Assembly, Assen Sirakov of NATO Defense College, Petya Petkova of Clockwork, Yassen Guev of BTC.
All too often, crises are mishandled, with marketing and communications professionals excluded from decision- making or brought in too late in the process to make a difference, Levick Among the AmCham guests who were willing to find more about state-of-the art PR were Assen Agov, National Assembly, Assen Sirakov, NATO Defense College, Petya Petkova, Clockwork, Ivan Angelov, Grand Hotel Sofia. Answering a question about the public policy in Washington, Levick said it is very 6 important in a crisis situation that you explain the issues to the public first. If you remain silent, you are losing influence.
"In a public relations crisis, make sure the people answering the phone are as well-trained as the person speaking to the reporters. You never know when the
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria twain shall meet," concluded his advice Assen Sirakov, NATO Defense College /left/ met with Richard Levick, CEO, Levick Communications Levick. ■ cover story
Continues from page 5 Maxim Behar is perhaps the most popular person, whose name would be familiar even to people without any serious interest in the Bulgarian PR market. Behar is Act like good clients the owner of M3 Communications. He could be seen in any TV There are two things that the clients of a PR agency must studio, broadcasting anything connected to PR or public image. know - PR has nothing to do with advertising, and besides For some 10 years in the business, M3 Communications has PR never comes for free. The first misunderstanding is managed to emerge as one of the top PR agencies. In 2000 M3 caused by the fact that both lines of business are com- Communications became a member of the international com- ponents of the marketing mix. And a second misunder- standing stems out of the fact that PR may achieve tremendous results without visible efforts. But PR is not a magic wand that spins public opinion in the desired direc- tion. The results are backed by the efforts of many peo- ple. The efficient communication of an organization with its audiences requires exceptionally frank and open rela- tions between the PR agency and its clients. It requires also confidence in the proposals made by the agency. Every PR professional with a longer experience has at least one encountered a situation, where, despite the tedious efforts to specify all outstanding questions, the client somehow manages to drop an inappropriate phrase during a news conference negating the efforts of PR advi- sors.
Unclear objectives and targets set by the clients are also a major problem for the PR agencies. Most often clients simply do not understand what PR actually means, hence Maxim Behar the gravity of the problem. The "make me a PR" phrase is a popular joke among PR professionals. The "brief" which munications chain Hill&Knowlton. Although he is criticized for the the PR agency asks the client to fill in, could be used as excessive publicity of his operations, Behar has managed to a remedy. This means that the client specifies what they attract as clients large companies like Microsoft, Sony Ericsson, expect to happen, and the agency explains how it could the DZI Bulgarian Financial Group, BMW, Lockheed Martin, and be achieved. However, even in this case the parties may other. Behar heads also the M3 College, offering supplementary training to PR practitioners. fail to reach understanding due to the excessively com- plex presentation made by the client. Hence, one more The contenders advice - sometimes the simpler the things are, the better.
MARC has development from its first day as an advertising Gergana Vassileva. United Partners is an affiliated partner to agency offering PR services. The company has evolved into a Manning, Selvage and Lee, and has managed to establish itself holding, comprising agencies offering the full range of marketing as one of the most successful agencies in Bulgaria. Their cam- communication services - from advertising (Publicis/MARC paign BGTeen.info for Procter&Gamble was praised as the best Advertising) and PR (Publicis/MARC Communications) to web corporate PR campaign by the International Public Relations marketing (Cybermark). The presence of the large international Association (IPRA) for 2003. Maria Gergova was appointed to the holding Publicis is due to the affiliation of MARC to the chain of board of IPRA. Besides the P&G giant, United Partners lists the the same name. Publicis/MARC Group was established and is Bulgarian Telecommunications Company, Coca-Cola, Lufthansa, managed by Nikolay Nedelchev. The Bulgarian-American Credit ING, and others as its clients. The producer company Metropolis Bank, Xerox-Bulgaria, Coca-Cola HBC Bulgaria and others are is among the few local clients of United Partners, but probably among the PR clients of the holding. The largest contract that this project is executed more for fun rather than for any financial the company has ever had was with the Delegation of the benefits. European Commission in Bulgaria in 2003. With a history dating about four years back, in 2001, All APRA Porter Novelli is managed by Tomislav Tsolov and Channels Communication is among the youngest agencies on 8 Lyubomir Alamanov. The agency, created in 1995, is among the the Bulgarian market. It is managed by Alexander Durchev. The most widely sought by clients. Currently, it provides services to company was established after the PR functions of the DeConi Globul, 3Com, Vinprom-Peshtera, HP, and others. From time to agency were separated from advertising. Despite its short histo- time Tsolov and Alamanov venture into political PR, their highest- ry, All Channels has already won four awards at the PR Prize profile accounts being the presidential campaigns of Peter competition, organized by the Bulgarian PR Company, and has Stoyanov and the mayoral campaigns of Stephan Sofianski. The demonstrated serious ambitions for the future. OMV, Postbank, agency is an affiliated member of the Porter Novelli chain. the Jim Beam brand, and others are among the agency's clients. Currently, All Channels Communication is trying to compete with
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria United Partners was established in 1996. The agency is headed bigger and more experienced players like M3 Communications by Managing Director Maria Gergova and Managing Partner for the budget of the Delegation of the European Commission. cover story
The market the PR aspect could be of a special importance for businesses, like corporate social responsibility, public affairs, internal com- According to various estimates, the PR market in Bulgaria is munications and the like, have been relegated to the bottom of appraised at 5-10 million Euro annually. It is difficult to come up the list of most widely used services. with a more precise figure, as there are many free-lance practi- tioners and many advertising companies offer PR services as Remuneration of journalists for actual publications remains well, mostly in the sphere of media contacts and the organiza- among the major problems encountered by the industry over the tion of specific events. This is seen as one of the major prob- last ten years. This is a problem, which is not specific for lems for the industry. Some of the PR agencies "strike back" at Bulgaria, as similar examples are known even in the United the advertising business by accepting small advertising contracts States. For instance, a serious scandal broke out earlier this year - the design and printing of leaflets, catalogues, sometimes for after its was established that government institutions have paid a the design of advertising campaign in printed media. radio talk-show host in Chicago for favorable editorializing; gov- ernment-produced news video releases were not identified as not Another problem stems out of the fact that the profession is being genuine TV reports when shown by local news stations. seen as "modern," as some professionals call it. Although the According to the survey of Desislava Boshnakova, almost half of PR teams usually stay hidden behind the scenes, there has the respondents agree that similar practices are routinely been an ever-growing interest in PR practice, which results in employed in Bulgaria. low professionalism and disappointed clients. Many prominent journalists and media managers, who have left their previous Despite all its problems, Bulgaria's PR market is moving in the jobs, emerge either as free-lance consultants or establish their right direction. It has still to develop and hence offer higher-qual- own agencies. ity services to its clients. A survey, carried out by the Capital Weekly in late 2004 found that all the large Bulgarian PR agen- This also results in a distortion of the market, most of in the per- cies expected an average 22 percent growth of the market in ceptions of the clients. Clients become used to the idea that PR 2005. Code of Ethics of the PR Practices in Bulgaria was is exhausted with maintaining relations with the media. This is far approved last summer. A mechanism for the activities of the from being true. According to a survey among PR practitioners Ethics Commission with the Bulgarian Public Relations held in 2004 by Desislava Boshnakova, professor at the New Association is expected to be launched within months. New inter- Bulgarian University, the services most frequently offered by national companies enter the market each year, expecting qual- agencies are related with media relations and the management ity PR services, which will result in raising the professional stan- of special events. Important aspects of this business, in which dards of the PR agencies. ■
10 AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria interview Bulgaria Must Establish Its Brand Aim high - do not stop at EU acceptance, but think how to become a model economic engine, says Richard Levick, president of Levick Communications By Irina Bacheva
Richard S. Levick, Esq., is the president of Levick Strategic Communications, a global leader in legal media. His firm has managed media strategies for many of the world's highest- profile matters, from the Catholic Church scan- dals and Guantanamo Bay, to the Rosie O'Donnell's magazine trial and the most signifi- cant civil litigation arising out of the Iraq war. The firm has managed the media in nearly 3,000 legal matters and crises, representing half the 100 largest law firms in America and one- third of the 100 largest in the world.
Mr. Levick and his firm have published acclaimed books, including Stop the Presses: The Litigation PR Desk Reference, Inside/ Outside: How Businesses Buy Legal Services, and 365 Marketing Meditations. His articles appear regularly in publications throughout the world. Mr. Levick speaks globally on highest- stakes communications issues. Recent engage- ments have included keynote addresses in China, Hong Kong, Australia, India and New Zealand as well as hundreds of speeches throughout the United States. He is a frequent commentator on radio and television on high- profile cases. PR News honored Mr. Levick as the Public Relations Professional of the Year for U.S. Agencies in 2002. This year he was a final-
ist for the Ernst&Young's Entrepreneur of the AmCham Bulgaria Magazine October 2005 Year.s
- Mr. Levick, you have visited excuse for not doing anything. The important how the company proceeds. Croatia, Romania and Bulgaria. lawyers would say, "Oh, but it was a Comparing the U.S. market to the different case." Different countries may - How many years have you been in Eastern European, do you think not use the same rules all the time but the business? there are standard rules for PR and they use the same thinking. The audi- page media strategy, or your approach ences and the media are still present; I have been working in the field with 11 depends very much on how well the there is the constituency, the stock- two firms for 17 years. Before that I market is developed? holders, the communities. In order to was in politics doing very similar vari- communicate effectively we have to ation of PR work for about 10 years. As different the various markets are - determine not only why something the American one, the one in does not work, but how it will work. I - What you are doing is on the inter- Dubrovnik, in Bucharest, in Sofia, in would say a spokesperson is a very section of law and business and is Mexico city - they are also very simi- important person for the company as very wide-ranging, from litigation lar. The media rules are the same, too. far as the audience "hears" with the and brand protection to PR and People will use differences as an eyes. At the same time it is far more marketing. Who are your clients? interview
Richard Levick is having a discussion with Bulgarian PR profesional Jassen Guev in Sofia. I am going to answer this question in your revenue. - Where do you get your information two ways. First of all my company is from - obviously your employees are not really that broad. It is narrow in a - What is the usual employee's pro- very well informed? sense it involves high stakes. If win- file in your company? ning is important, this is the only kind We buy a lot of private and public ser- of a client will be representing. We do We have our vice presidents, with an vices. These are Lexus, Factiva, dif- not care whether our client is large, or average of 27-30 years of experi- ferent data agencies, because part of small. We have never lost in the high- ence and all of them come from dif- our job is to be informed. Our employ- stakes management. Our teams only ferent industries - food industry, ees love knowledge. They are eclectic accept clients we can work with, and insurance, finance industry, telecom- and read different books; in addition we'll not accept somebody who will munications and legal industry. So they have their own particular exper- not listen to us. For example, now in the vice presidents bring three skills: tise. When for example you are han- the United States we have a lot of an extraordinary experience, which dling the Catholic Church issues it is reconstruction work after the hurri- usually includes political knowledge, not about what kind of beliefs you cane disaster in New Orleans. We specific industry skills and communi- have been raised with and what you have clients from data, reconstruction cations experience. We can under- think. I love the fact that 8 percent of and rebuilding businesses. We have stand the political machinations, the our business is with the Middle told them: you have just several political, investors' and diplomatic Eastern countries. months and you have to listen what issues. we are saying to you. These clients - How do you deal with the journal- have agreed and in the result they are The company's mid-level people have ists in the United States? covered in the media all the time: in as average from 12 to 15 years of New York Times, on Good Morning experience and most of them, too, I have thousands contacts with the US 12 America. These companies are help- come from the specific industries. journalists who trust us because we ing now the legal and banking system Most importantly, these people are tell them the truth. They view us as an to get back on, also the whole infra- decision makers. The worst thing in additional source of information. We structure in the devastated regions, to life is to be a spectator - one has to deal with the liberal and conservative restore the insurance system where all be a protagonist. Our teams usually media, most of them pretending to be the records were lost. The people I work with 17 clients each. It means independent. work with do not believe in a very you have to be prepared to deal at the popular American rule that you have same time with Mexican political The PR business in United States
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria to focus on the 20 percent of your issues, Catholic Church issues, and started in the 1880s with Buffalo Bill, clients who generate 80 percent of financial restructuring issues. the famous showman of the Wild interview
West. We did not see publicity in legal different ways. question for the country economically issues in the United States until the is not how Bulgaria could be accept- early 1860s when the New York - What was the most difficult case ed into the EU, but how you can Times was sued for an advertisement for you? become a model of economic engine they ran which was opposed to in the Union. racism in the South. We almost never They are all challenging. The act as a spokespersons with the Guantanamo Bay, though, was very - That is quite a purpose… media, but determine the overall strat- difficult, the Catholic Church case, egy be. We are not in front of the too. Concerning the Guantanamo Bay From great purpose come great cameras. case nobody in America was willing to things. When a law firm comes into touch it. Now the situation is different the world, the question is how to meet - Do you regard blogs as the "fifth" - everybody wants to do it because it the world. There are several thou- media? is our 'heroic time.' We believe in two sands of lawyers in the United States things: abundance mentality, which and we all do different things, what No, I think the blogs are just today's means we are not trying to protect our should be our brands, what should we hooks, they are popular but they are territory, because we'll meet with any- say? also overwhelming. They just combine one; it is all about giving from your- e-mails. The e-media focuses the self. The other thing we carry about in - How can Bulgaria become a model public attention because it offers new the company is winning. for EU? kind of communication. The blogs will become more and more commercial - Have you been provoked by some- Your companies need to penetrate the and simpler with the maturing of the thing in Bulgaria? European markets by opening offices market. That is what happens to the there because this way you bring in web, it is becoming commercialized. The great challenge for Bulgaria right the industry, the tourism; you will be Blogs are important, but they are not now is what your country's brand is, the economic engine of the country. the future. It is just another tool of how would the rest of the world know You must be grounded up in Europe, human relations just as the newspa- you? Look at the European Union where a company got its four walls, pers, television, postcards, advertise- where Bulgaria is heading for in 2007. and start developing an specific busi- ment is. We learn by seeing things in You have to look to the EU and the ness. ■
iF YOUR AD WERE pLACED HERE, AMCHAM ADVERTISING RATES
BACK COVER ...... 1330 BGN YOUR MESSAGE SECOND COVER ...... 1220 BGN THIRD COVER ...... 1180 BGN • WOULD BE CONVEYED TO THE LEADING US, INTERNATIONAL AND TWO PAGES SPREAD ...... 1440 BGN BULGARIAN COMPANIES OPERATING WITHIN BULGARIA; FULL PAGE ...... 960 BGN HALF PAGE ...... 780 BGN • WOULD REACH THE DESKS OF SENIOR EXECUTIVES AND DECISION-MAKERS QUARTER PAGE ...... 580 BGN WHODEMANDHIGHQUALITYPRODUCTSANDSERVICES; LOGO ...... 350 BGN INSERT ...... 840 BGN • WOULD TRAVEL ACROSS THE EUROPEAN CONTINENT AS WELL AS THE UNITED STATES, TAKING FULL ADVANTAGE OF THE INTERNATIONAL NET- DISCOUNTS: WORK OF AMERICAN CHAMBERS OF COMMERCE;
14 AMCHAM MEMBERS ...... 20% • WOULD SERVE AS AN IDEAL NETWORKING OPPORTUNITY FOR POTENTIAL ADVERTISING AGENCIES ...... 15% FOREIGN INVESTORS AND BUSINESSMEN VISITING BULGARIA. MAX VOLUME DISCOUNT ...... 10%
THE RIGHT MESSAGE TO THE RIGHT AUDIENCE. For more details please contact: AmCham Bulgaria Office – Nadia Vakareeva, phone: 976 95 65, e-mail: [email protected] AmCham Bulgaria Magazine – Milen Marchev, phone: 846 88 32, e-mail: [email protected] AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria politics Sofia's Mayoral Election Is Ripe With Suspense …but voters plan to watch the contest from home By Marina Tzvetkova "The garbage has no color", said the numerous stray dogs, and the man- highest-rated player in the mayoral recently a prominent Bulgarian histori- agement of municipal assets. race. For the time being, it is impossi- an. It's remarks illustrate the tough ble to predict the outcome of the vote choice that the citizens of Sofia have Political analysts predict spectacular on October 29. The "star" candidates to do on October 25, 2005 when partial clashes between the contenders, as have been joined by two party candi- mayoral elections will take place. The nominees will try to spread their appeal dates, nominated by the division-torn capital will have to elect a new mayor beyond the traditional supporters of right wing, which traditionally partici- after Stefan Sofianski entered the 40- their political parties. pates in the contest. Rightist factions th National Assembly as a representa- failed to agree on a joint candidate, tive of the Bulgarian Popular Union After the two-star General Boyko and Democrats for Strong Bulgaria coalition. After 15 years of democratic Borissov, former chief secretary of the (DSB), headed by former Prime self-governing, Sofia still has to solve interior ministry, and Tatyana Doncheva Minister Ivan Kostov, nominated the for- major issues like waste disposal, the (nominated by the Bulgarian Socialist mer central bank governor Svetoslav poor state of maintenance of the roads Party, BSP), former Finance Minister Gavriiski. The Union of Democratic and the insufficient parking facilities, Milen Velchev emerged as the third Forces (UDF), Continues on page 18
Milen Velchev (NMS) National Bank of Greece, after which and Finance Commission. Some in he settled at Merrill Lynch in London. BSP do not like the fact that Velchev's He participated in the procedures for younger brother owns a number of the awards of the second GSM license hotels along the Black Sea coast, nor in Bulgaria to the Greek OTE, and in would they forget the scandal with pic- the negotiation for the acquisition of tures aboard a yacht in Monaco, where the United Bulgarian Bank by the Velchev was in the company of Ivan National Bank of Greece. He was Dimitrov (the Doctor), a top suspect in appointed at Merrill Lynch's depart- smuggling. ment of investment banking in East Europe, the Middle East and Africa. Milen Velchev was the undisputed Velchev served as vice-president in the nomination for the eight edition of the Emerging Markets sector of the Mr. Economics Award of the London-based bank between 1999 and "Economics" magazine in 2003. The 2001. Velchev is married, with one award is given for the comprehensive child. contribution of the nominee to the development of the national economy. The finance minister in the Saxe- He also received the high-profile Coburg-Gotha government belongs Euromoney "Finance Minister of the to the group of politicians, whose Year" award for 2002. Velchev won name is mentioned for any top these awards in recognition of his con- vacant post. Velchev was the only tribution for raising Bulgaria's credit Milen Velchev was born on March 24, member of the political council of rating, for the achieved macro-eco- 1966. He graduated in international the NMS who did not vote "against" nomic stability, for his role in the suc- relations from the University of but abstained instead when the NMS cessful negotiations with the National and World Economy in Sofia. was debating whether to join BSP in International Monetary Fund, for his 16 He completed his MBA studies at the a cabinet. role in reducing Bulgaria's foreign debt Rochester (N.Y.) University, and attend- as well as for his skillful management ed business management and finan- After the formation of the tripartite of the country's budgets throughout cial engineering courses at MTI. BSP-NMS-MRF coalition, Velchev his mandate. Served as attache at the "International refused to be appointed as chairman Organizations" department and adviser of the parliament's Transport Svetoslav Gavriiski (DSB) on political issues at the United Commission, claiming that the post Nations and Bulgaria's Ministry of was way below his level, and remained Svetoslav Gavriiski was born on Dec.
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria Foreign Affairs. He worked for the only a deputy chairman of the Budget 18, 1948 in the town of Svishtov, in the politics
Finishing some of the stages in Sofia Metropolitan project will be one of the new mayor tasts.
family of a prominent lawyer and pro- Gavriiski participated in the negotia- Gavriiski's successor. He was even fessor on insurance law, Velislav tions with the London club of private nominated for a second term and won Gavriiski. He finished secondary creditors for resettlement and restruc- 56 votes - of the United Democratic school in Sofia, and in 1972 received turing of Bulgaria's foreign debt. Forces and the so-called mandate a degree in foreign trade from the for- bearers within the NMS, the mer Higher Economics Institute, now Between February and May 1997, Oborishte Movement and Party of the renamed University of National and Gavriiski served as a finance minister Bulgarian Women. Upon handing his World Economy. in the caretaker government headed top-banker's post to Ivan Iskrov, by Stefan Sofianski, and in this capac- Gavriiski said that there was nothing Gavriiski has worked at the finance ity started the talks with the related to his mandate as BNB ministry since 1972 as an expert, chief International Monetary Fund on the Governor that has remained con- expert, head of department, head of introduction of the currency board. cealed. chief department, and first deputy min- ister (1992-1997). He supported the position that the cur- Gavriiski is not a member and has rency board was the last option for never been a member of any political Bulgaria to stabilize it financial situa- party. The Sofia clubs of the Union of tion and its economy, and in that Democratic Forces (UDF) came up in Gavriiski has been proven right. He the summer of 2003 with the idea to participated in the drafting of the new nominate Gavriiski as candidate at the AmCham Bulgaria Magazine October 2005 Bulgarian National Bank Act, by the then mayoral elections. This idea how- virtue of which the currency board was ever collapsed due to the infighting introduced on July 1, 1997. that erupted at that time within the UDF rank and file. Gavriiski was elected by the 38th National Assembly as Governor of the Svetoslav Gavriiski is not married. Bulgarian National Bank on June 11, page 1997. He remained at this post for a Lt.-Gen. (two-star) Boyko Borissov 17 full seven-year mandate. He has been (independent) working as a consultant after he was replaced at the top BNB post. Recently, the General, as he is known, formally submitted to Minister of His tenure at the BNB was extended Interior Roumen Petkov his resignation by four months in 2004 because the as chief secretary of the ministry. then ruling NMS and MRF failed to Borissov said that he was resigning as reach an agreement with BSP on his opinion on the new amendments of politics
Continues from page 16 supported by Sofianski's Party of the Free Democrats, nominated the incum- bent care-taker mayor, Minko Gerdjikov. Expert for mayor?
The new Sofia mayor must present a clear alternative of the status quo, as most of the inhabitants of the capital city want a change in management. This is the premise supported by most political analysts in their forecasts about the outcome of the mayoral vote. None of the potential winners could rely on the support of a powerful polit- ical configuration that would assist in the complex interaction with the munic- ipal council and with the community - in all cases, the future mayor could rely on nothing more than a minority.
"We should not expect a strong mayor, while a weak mayor would not be capable of Continues on page 20 City waist problem is still on schedule.
the Ministry of the Interior Act had not dictator Todor Zhivkov after 1989, too. that the chief secretary was always on been taken into consideration. Before assuming his post at the interi- the crime scene during important or ministry in the summer of 2001, operations, assumed personal respon- "I have not authorized anybody to Borissov headed the Ipon security sibility for the actions of the police. nominate me for mayor," Borissov said, company. His friend, Tsvetelina The German news source concluded but added, "I still have not decided Borislavova, was appointed as the that "perhaps this is the reason for his what I am going to do, I had to make head of EIBank after the NMS came success, as he seems to know also this step in order to feel free." to power. the other, the criminal side." Borissov's name came to public atten- tion at the time when he served as the Shortly after joining the interior min- Some fiction-prone analysts have hint- personal bodyguard of the royal fami- istry, Borissov was included by survey ed that Borissov has been personally ly, long before Simeon Saxe-Coburg- agencies in polls together with politi- responsible for the elimination of noto- Gotha became prime minister. He cians, and was regularly on the top of rious underground personalities since served as bodyguard to the deposed the list in terms of popular support, 2001 - a hypothesis, which was further with record-high ratings. elaborated by the British Sunday Times on Sept. 11, 2005, without however The interior ministry released informa- mentioning any names. tion on its own actions and on the actions of the special services at new Being often in the limelight of the conferences, always attended by the media, the General was the first guest General. Police press offices seemed of the show of the graduates of the obliged to always specify that the Ku-Ku Band Music Academy, who operations were headed personally by sang him his favorite songs. "Brother the chief secretary. Boyko" is however also the favorite tar- get of satirical parodies on the popu- Reuters wrote in 2002 a long feature lar late-night Slavi's Show. 18 about the "energetic former bodyguard, who has turned in Bulgaria's most Borissov was born on June 19, 1959, popular figure." The feature was illus- in Bankya. He received a master's trated by a picture of the chief secre- degree in firefighting. Between 1985 tary taken while he was training at a and 1990 he was a lecturer at the fitness facility. "With his long black Ministry of the Interior. He completed a coat and sunglasses he looks like a doctor's dissertation titled Hollywood star," commented also the "Psychological and physical prepared-
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria Bavarian radio, which went on to stress ness of the operative personnel." politics
Continues from page 18 the basis of an almost compulsory forthcoming presidential elections, changing anything," sociologist Zhivko coalition between the BSP, the while boosting the chances for early Georgiev said. National Movement Simeon II (NMS) parliamentary elections. and the Movement for Rights and A politically unaffiliated professional Freedoms (MRF). The cabinet is The election of the mayor of the cap- of record is seen as the potential charged with the paramount task to ital city - among the most important future winner of the mayoral elections finalize the procedures for Bulgaria's posts in the country - is seen as the in Sofia. This statement is seen as accession to the EU. This binding catalyst for political developments in one more proof that strictly political political objective must be achieved society. There are expectations that nominees ere no longer capable to on the background of a deep crisis in the various political parties will rise above the level of their hard-core the right-wing political spectrum, search for answers to major political electorate. Besides, this statement is which seriously limits the leverage on questions during the mayoral elec- interpreted as an indication that the political life of the right-of-center tions. For the ruling coalition, these Bulgarian voters prefer professional- parties in a crucial period. Hence, elections will be a test of the poten- ism and pragmatism to partisan and many analysts claim that the right- tial for joint government. As far as the ideological affiliation, the "Barometer wing potential in Sofia is diminishing right-of-center parties are concerned, Info" agency wrote in an analysis. as a result of the problems among the the Sofia elections will be nothing parties. short of It is a fact that the early mayoral elections in Sofia will be held in a An eventual victory of the opposition a survival test contradictory and unclear political in the mayoral elections in Sofia, how- environment. After the deadlock of ever, would be tantamount to the first It is certain that the mayoral elections the parliamentary elections, the multi- major political failure of the ruling will not provide any advantages to the colored parliament barely managed to coalition. Such a victory might "good man, father, husband and pub- structure a functional government on emerge as a serious challenge for the lic figure." Instead, the advantages will
In 1991, Borissov created the Ipon-1 trates, etc. OOD company. He is also a member of the World Bodyguard Organization, One of the most critical statements, IAPPA. Borissov has been an active which caused riots within her own karate sportsman since 1978, and has party shortly before the parliamentary the 7th dan. He has been coaching elections, was that Sergey Stanishev is the national karate team and has still too young and inexperienced to be appeared also as an international ref- a prime minister. Several months eree during sport events. before that she had aired a similar the- sis, claiming that Stanishev does not Borissov was appointed by a presiden- radiate power. She went as far as to tial decree to the Ministry of the claim that he has no leadership expe- Interior with the military rank of colonel rience and that he has had no time to in 2001. He was promoted to Major accumulate physical and psychological General (January 2002) and capabilities to impart the feeling of Lieutenant General (June 2004). power. "It is not possible to assume the supreme party post without chairing Borissov is also famous as an ardent even a local community group," she activist in a campaign to gain the has been quoted as saying. recognition of the international cyno- logical community for the Bulgarian Doncheva is known to have explained Sheppard Dog. His home in Bankya is parliamentary group of the Democratic in details to the media that the BSP guarded by four dogs of the same Left and a member of the National does not have the experienced per- breed, two of which are recognized as Security Commission of the National sonnel for key spheres of power, that the best breeding family in Bulgaria. Assembly. She is also a member of the party is exercising on paper with Their offspring have been given as the Executive Board of the Bulgarian government projects and parameters. 20 present to various dignitaries, including Socialist Party. She served as prose- "After eight years in opposition," she the King of Spain. cutor in Gabrovo and in the Sofia City confessed last year, "it is difficult for us Prosecutor's Office, and worked as a to find professionals." Tatyana Doncheva lawyer. (Coalition for Bulgaria) Doncheva urged the BSP in 2002 to Criticism is the main weapon of her break away from "dependencies" dat- Tatyana Doncheva was born in politics. She criticizes everything and ing back more than 10 years. She Tryavna. She is a lawyer by education, everybody - her co-partisans and her specified that she had in mind the
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria and is currently the deputy head of the opponents, parties, institutions, magis- dependence of the party on the busi- politics
the facts
● 1,417 territorial electoral con- ● In a joint declaration, several eco- stituencies will be established for logical organizations and repre- the partial elections in Sofia, sentatives of the population of according to an order issued by the towns and villages close to Minko Gerdjikov; the waste treatment facilities around Sofia announced they will ● 35 percent of all Sofia citizens will boycott the partial local elections vote on October 29, according to in the capital city. Citizens threat- the forecasts announced by soci- en that unless the unlawful oper- ologist Michail Mirchev of ASSA- ation of the waste treatment facil- M agency; ities is suspended, and unless the executive authorities comply ● 7 percent of the voters in Sofia with their major claims, the have said they are ready to vote affected population will boycott for Tatyana Doncheva, and 6 per- the partial mayoral elections in cent - for Svetoslav Gavriiski, Sofia. The declaration was signed according to sociologist Yulii by representatives of the inhabi- Pavlov; tants of the Trebich section of local elections also in Sevlievo, the Nadezhda Region in Sofia, of ● 32 parties and coalitions have Rousse, Devnya, Panagyurishte, the Obelya section of the been registered by the Central Peshtera, Mizia and Razgrad, as Vrabnitsa Region, of the village of Electoral Commission (CEC) for well as partial elections for mayor Mirovyane in the region of Novi participation in the partial local of the municipality of Golyamo Iskar, of Druzhba and Mladost elections on October 29 in 11 Vranovo, in the Rousse region, in residential complexes, of the cities and towns. 29 of these fac- the Iztok region of Pernik, and in Kremikovtsi municipality, as well tions have announced they will the village of Irechekovo, in the as by a number of ecological compete for Sofia. There will be Yambol region; organizations. AmCham Bulgaria Magazine October 2005
page 21 politics
be on the side of the candidate who will manage to deliver a political mes- sage, capable of mobilizing voters beyond the boundaries of his or her strictly partisan support.
As a rule, mayoral elections in Bulgaria are based on majority repre- sentation. Still, the elections in Sofia have always been political and Sofia voters vote according to political affil- iation much more actively than else- where.
The profile of the right-wing voter in Sofia has not changed much. These are both young and elderly voters. The elderly are linked to the generations before 1944 and are thus somehow related to democratic traditions. Young people are basically oriented to mod- ern developments in society. However, Sofia voters are not overly capable of mobilization. They are more aristocrati- cally attuned. The situation now is real- Crime wave in Sofia as well as the traffic problems has to be in the new mayors agenda.
ness. Ivan Kostov, according to her, is ordinary firefighter." enter the deep waters," Doncheva said dependent on business, and, using the recently. slogan "Let us win the state from the The former government was often the criminal groups," has suppressed those target of her attacks during debates Minko Gerdjikov (UDF) business that had been unwilling to in Parliament. "You came as a messi- succumb to political subordination. ah, and you are leaving as a hostage of the interests that gave you the In spite of her claims that business power," she told outgoing Prime interferes in the politics and in the Minister Simeon Saxe-Coburg-Gotha. affairs of the state, Doncheva is She added that the prime minister rumored to be the owner of three has been treating the citizens as hotels and to be engaged in joint mere subjects. "There are ministers business with a prominent former who still have no idea what their insti- police chief. She is often discussing tutions are doing," she said shortly the relations between parties and before the end of the mandate of the magistrates. Doncheva has claimed former cabinet. that parties forward their interests by using the services of certain magis- Doncheva is acknowledged to be a trates. She also insists that a "court- strong mathematician, decent violin of-justice feudalism" plagues Bulgaria player and skilful attorney. Because of and that the underground has climbed all the critical statements addressed to to the top of the justice system. She her party and its leadership, some pre- is a proponent of the idea to employ dicted that Doncheva will not be special intelligence means also included in the lists for the 2005 elec- against members of parliament and tions. In response, she reminded that ministers. One of her favorite topics is Churchill was also forced several time Minko Gerdjikov was born on May 2, 22 the "merger" of the Ministry of the to leave the political arena. Still, she 1995, in the town of Troyan. He has Interior and crime. was again elected to the parliament. graduated with a degree in finance from the University of National and She was not afraid to challenge the "The nomination of mayoral candidates World Economy in Sofia. He served as most popular person in Bulgaria - Gen. in any European capital is politically a deputy minister of trade and foreign Boyko Borissov - during his tenure as motivated. If somebody starts to claim economic relations in the caretaker the chief secretary of the Interior that they have nominated an expert, cabinet of Stefan Sofianski, and head- Ministry. He urged him to shut up - lit- that would mean that no person of any ed the talks for Bulgaria's accession to
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria erally - and called him "nothing but an political clout was brave enough to CEFTA and for signing of free-trade politics
ly different - a number of right-of-cen- second round. ter parties, a lot of problems between them, problems at the municipality. The According to forecasts, the battle for 33 stakes at these elections are high for Moskovska Str. will be resolved at the both politicians and for the citizens of second round. It seems more probable Sofia. that the leftist candidate, Tatyana Doncheva, will lead after the first round. The profile of the leftist voters on the But none of the candidates could win capital is different, too. Leftist voters in easily. Sofia have higher incomes and are bet- ter educated. This is the traditional The major issue for Sofia is not actual- capital-city leftist constituency, linked to ly the party affiliation of the mayor but former Communist Party and the the model of government, which most nomenclature. At the same time, as a concisely could be described as an result of migration processes, there are unauthorized utilization of public assets already people living in Sofia who for personal interests. This is the came from the province, who vote here biggest problem, which gives rise to a and thus increase the number of leftist host of others: the city is dirty, as mak- votes. ing money out of refuse is much more important; there are stray dogs, as they Sofia's leftist voting constituency is are a suitable instrument to leak funds not as disciplined as the leftist voters out of the municipality, and so on. By all in the rural regions. That is why voters' indications, the campaign will not deal turnout at the first round is usually with the model, but rather with its con- lower, and mobilization comes at the sequences. ■ agreements. He has been the deputy status of the municipality and the long- Ventseslav Dimitrov (Independent) mayor of Sofia in charge of finances standing problem of household waste since 2003, and took over as mayor disposal, the Roma ghettos, the land- pro tem after Sofianski was elected to scaping, and the stray dogs. parliament. "I am a person of market orientation Because of this municipal experience, and with right-of-center affiliation. My Minko Gerdjikov is the most suitable ideal is Bulgaria's accession to the EU, nominee as candidate for the post of and that is why I am grateful to the the Sofia mayor, the UDF declared UDF and to the other parties, which recently. The followers of former UDF supported my candidacy. Besides, I leader Nadezhda Mihailova (who was would like to implement a program that replaced by former President Petar would lead to the renaissance of Stoyanov last Saturday) proposed to Sofia. The reason for this is very sim- the other right-of-center parties to ple. I have been living in this city since support Gerdjikov as an independent I was 12 years old. My parents live in candidate and expert. "Sofia needs a Sofia. My wife and my children were competent management, and born in Sofia, and God willing, my Gerdjikov has demonstrated that he grandchildren will also live in Sofia," AmCham Bulgaria Magazine October 2005 can overcome problems. Besides, he Gerdjikov said. demonstrates an open and dignified attitude to the citizens of the capital "A mayor must be able to communi- city," the UDF leader said. cate and interact with the municipal council. Theoretically at least, 70 per- The former UDF parliamentarian was "I want the Sofia citizens to genuinely cent of the decisions in the municipal- nominated as an independent candi- participate in the management of the ity are made by the municipal council, date by an initiative committee, which page city. We are all interested in the renais- while the mayor has the executive listed the constitutional justice Georgi 23 sance of the this city, so that it would power to implement these decisions. At Markov, professors Alexander Chirkov join the EU as a modern European city the same time it must be kept in mind and Mihail Nedelchev, and former and not as a city with a Balkan and that the mayor and the municipal member of the parliament Dimitar Oriental face," Minko Gerdjikov was council are closely linked to the cen- Ivanov. Ventseslav Dimitrov, a financier, quoted recently as saying. tral government, as Sofia generates 33 has promised that he will follow neither per cent of Bulgaria's GDP, and all a rightist nor a leftist policy and will He highlighted as priorities in his pro- major events take place in Sofia," concentrate of the problems of the gram the improvement of the financial Gerdjikov added. municipality. ■ analysis Economic Growth and Outlook In line with the good early indicators for Q2 (industrial sales, of at least 30% of GDP. The active bank lending and the EU exports, fiscal revenues), the GDP growth has accelerated to funds arranged under the EU accession agenda will thus con- real 6.4% y/y for the period relative to 6% y/y in Q1, accord- tinue to push up investments in mediums terms. On the other ing to preliminary data of the statistical institute. The growth hand, the shaky privatisation plan of the newly settled centre- rate is estimated at 6.2% y/y in H1, reflecting higher-than-aver- left government suggests that privatisation-related foreign age performance in the industrial and service sectors. The fig- investments will play a weaker role in the forthcoming several ures are compared with a full-year growth projection of 5.6% years. Nevertheless, green-field projects as well as upgrade set in the budget for this year. The agricultural sector reports programmes of recently privatised entities will continue to sup- a new downward shift of 5.2% y/y in Q2 and 3.9% y/y in H1 port overall investments. to mark a rather unstable performance in the past 5 years. The ups and downs in the farming produce provide another indi- Real growth by quarters (%, y/y) cation for inefficient allocation of state aids. Despite poor reports of farmers, the private sector retains spectacular expansion rates of 9.1% y/y in Q1 and 10.8% y/y in Q2 reach- ing 78% of the gross value added.
On the demand side of the economy, investments and exports have surged by 16.8% y/y and 12% y/y in Q2 to score a solid improvement in relation in Q1. Consumption has increased at a slightly lower rate than the overall GDP due to a cautious spending on the side of households. Imports continue to out- run exports in terms of absolute and growth figures but it is easy to spot that the pickup is strongly biased to investments, many of which are oriented to export industries and/or financed by non-debt FDI inflows. Despite the progress in Q2, most of the real sector indica- tors for July and August, as well as the business sentiment GDP growth in real terms (%, y/y) surveys covering future periods, are pointing to a growth 2001 2002 2003 2004 Q1/05 Q2/05 H1/05 slowdown to some 5% y/y in the last 2 quarters of the year and some 5.5% for the whole year. The central bank pro- 0.3 5.5 -1. 0 2.2 -1. 7 -5.2 -3.9 jections are put in the range of 5.4-5.8%. Our estimates weigh in adverse supply shocks from high oil prices, flood 4.1 4.6 6.8 5.3 8.2 9.3 8.8 damages, certain demand downturns on the world steel mar- 4.7 5.1 4.0 6.0 7.4 6.4 6.9 ket that have affected both export and industrial reports for Q3, and base effects established by booming economic indi- GDP 4.1 4.9 4.5 5.6 6.0 6.4 6.2 cators for H2 last year. Oil prices still have a relatively weak 4.4 3.6 6.6 5.0 7.3 5.9 6.6 effect on local producers but the mulled hikes for natural gas prices in October will further worsen input costs of 23.3 8.5 13.9 12.0 9.2 16.8 13.4 energy intensive businesses. Nevertheless, the major nega- AmCham Bulgaria Magazine October 2005 10.0 7.0 8.0 13.1 8.8 12.0 10.5 tives of the oil shock are to be seen next year. Apart from the slowdown components, the aggregate supply and 14.8 4.9 15.3 14.1 10.8 15.5 13.3 demand will be favourably pushed by the stable rates of Source: National Statistical Institute, preliminary data for 2004, 2005 expansion in tourism, construction and telecom sectors. Certain manufacturing activities like electronics, electrical Although investment in fixed capital, excluding change in inven- appliances, and food exporters will also tend to support rel- tories, is advancing at a very strong pace since 1997, its share atively high GDP growth rates in H2 and next year despite page in GDP is still relatively low at 23.6% in Q2 and 22.1% in H1. global slowdown effects. These sectors are benefiting from 25 The weak infrastructure of the country, need for technological foreign investments and trade integration with EU that would upgrades as well as ongoing restructuring in manufacturing more than offset spill-over effects from global demand and and network industries are requiring much higher investments supply shocks. ■
This article is based on extracts from ISI Emerging Markets IntelliNews publications: Bulgaria This Week and Bulgaria Country Report. For more detailed information please contact ISI Emerging Markets office in Sofia at +359 2 8160404 [email protected] analysis Yellow Cards, Red Boxes on Bulgaria's Road to EU Bucharest and Sofia will be kept in suspense about their membership prospects until the very accession By Yuliana Boncheva If you listen carefully to Bulgarian politicians talking about Bulgaria's partners today. Bulgaria's prospects with the European Union, you will get pret- ty confused. Opinions range from lightheaded confidence that A "three-box" report everything will be OK with the membership, to angry remarks about the "biased" Europeans and to apocalyptic predictions of "If we do not lose speed, there is nothing to worry about," failure of the EU membership and its disastrous implications. European Affairs Minister Meglena Kuneva often says. The last few days before the EC published its report on Bulgaria, howev- Which of these predictions is right and which is wrong? It is still er, were increasingly nervous because of the delay in the sum- early to say. The latest report of the European Commission on mer. The difficult formation of a government after the parlia- Bulgaria's progress in the preparation for the EU only says that mentary elections, which took two full months, in practice para- membership from Jan. 1, 2007 is absolutely possible but not at lyzed reforms and legislation. all certain. According to Kuneva, who was the Minister of European Affairs How shall we read this? Is there a real threat that Brussels may in the previous government too, after the torch of government trigger the notorious safeguard clause and put off its enlargement was passed on, Bulgaria has made up for the delay and has pre- with Bulgaria and Romania for a year? sented sufficient evidence to the European Commission experts for their October report. Deserved mistrust EC's new report specifies the tasks Bulgaria has to fulfill by the The authorities in Sofia could not manage to reform the clumsy end of 2006. The report categorizes the issues in three "boxes," and corrupt penal procedure before the elections in June. They Kuneva explained. The green box contains the trouble-free areas. did not even meet the end-of-September deadline. The parlia- The yellow one names the issues that still have something to be ment missed yet another deadline, October 8. The delay cost addressed. The red section includes the problems that require Bulgaria its lead in reforms and now it has to catch up with the urgent measures. For years, the justice and home affairs chap- other candidate, Romania, which got a better report on its ter has inevitably remained in the hottest part of the red box. progress. The difficult homework Both countries still have difficult tasks to do: they have to secure skilled officers and active structures to utilize the billions of As far back as half a year ago, the European Commission sent European funds; they have to improve environmental control and warning letters to the two aspirants concerning the slow reforms implement a series of other measures. But the toughest task of in some key areas. all is to cope with their proverbial corruption and in the case of Bulgaria - to check the criminal groups that control large sectors In June, European enlargement commissioner Olli Rehn warned of the economy through a network of legal, semi-legal and down- that Brussels was preparing to issue "yellow cards" to Bulgaria in right illegal firms. If these reforms fail, the coveted EU entry five areas. A few days later a letter arrived with the most impor- could be delayed by a year. tant remarks and requirements:
Two "fatal" months Freedom to provide services: To eliminate the limitations con- cerning the right to set up business; to improve the work of the Local politicians have been recently excusing themselves with the Commission for the Protection of Personal Data; to apply the two-month gap after the elections when Bulgaria did not have a European rules for insurance of motor vehicles. government. It is actually obvious that this can hardly be con- 26 sidered as fatal. What is more disturbing is the product of these Copyright: To introduce and effectively apply the rights for pro- weeks of political haggling: a government of the Socialist Party, tection of intellectual property, especially in the fight against pira- the liberal Simeon II National Movement and the Movement for cy and forgery. Rights and Freedoms. Agriculture: To establish a payment agency in the agriculture sec- The triple alliance has been trying to subdue the internal con- tor; to introduce special organizations for the wine and milk mar- troversies since its very first day. Besides, it is definitely left- kets; to restructure the veterinary sector and amend the frame- oriented. The governing coalition has already lost a lot of pre- work veterinary law; to create structures of border inspections
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria cious time to settle its own arguments instead of directing all and implement the EU border control procedures; to improve ani- its efforts to European preparation. This is what worries mals' health and set up a contingency fund; to apply the analysis
European rules and standards for animal care; to modernize the enterprises in the food and beverage industry.
Environment: To ensure the comprehensive application of the European rules for environment impact assessment, as well as in the field of air quality, waste management, genetically modi- fied organisms, noise and radiation protection.
Justice and home affairs: To finish the judicial reform. To ensure efficiency and transparency in the pre-trial phase: through a new Penal Procedure Code and other related laws, including the Judiciary Act, the Penal Code and the Ministry of the Interior Act.
Brussels presented a clear ultimatum concerning the new Penal Procedure Code. The European Commission insisted that inves- tigators should examine a minimum number of crimes and all Solomon Pasi, Chairman of Foreign Policy Committee in the National Assembly other cases should be dealt with by the Interior Ministry; each and Miglena Kuneva, Minister of European Affairs are were members of the for- case should have a monitoring prosecutor; the new law should mer government as well, but are still key players in the European access process. enter into force within six months of adoption at the latest. ery of verdicts for years. The clumsy law enforcement procedure is one of the awful defects of the Bulgarian justice system and 5 + 2? one of the most often criticized areas.
In August the government press office informed the Bulgarian Of course nobody expects that Bulgaria and Romania will public about the five most criticized areas. Shortly after, foreign destroy the mafia and corruption in a few months' time. Geoffrey minister Ivaylo Kalfin admitted that two more issues seriously van Orden MEP clearly explained what the EU expected from concerned the European Commission: the management of Bulgaria: European funds and the free movement of persons. Thus it emerged that the yellow cards to Bulgaria were actually not five, "You should show you are making the necessary steps. Not just but seven. approve laws but effectively apply them afterwards. It is easy to make pieces of laws on paper. It is harder to show results. The deputy head of the EC delegation to Sofia, Ruud van Enk, pointed out, "We are watching closely what the teams of the new You should show that the people who consider themselves ministers will be. If Bulgaria joins the EU on Jan. 1, 2007, the untouchable will face justice. I think the people want to see country will receive over 4 billion Euro from the structural funds arrests, legal procedures, practical results. in the first three years. The problem is that too few good projects are presented. In this respect Bulgaria is badly lacking capacity There are well rooted criminal elements in all countries but we and professionalism." are trying to cope with them. You should show the same dili- gence yourself. It is natural for Brussels to want proof that Bulgaria deserves the billions; that it will present and defend enough quality projects for Even now there is serious criticism about the shortages of the financial aid and that the funding will not be drained to parties, countries that joined the EU a year and a half ago. Even in Old officials and private accounts. Europe there are countries where not everything is up to the European criteria. But every country is trying to take this criti- The mafia as an obstacle cism into account. It is important for Bulgaria to show it is mak- ing efforts. AmCham Bulgaria Magazine October 2005 "Bulgarian mafia threatens our EU accession," Romanian media have been clamoring recently. "There is a boom of organized A question of information crime in Bulgaria, which has reached an alarming level, and which together with corruption may trigger the safeguard clause." Romanian president Trayan Basescu said he believed in the objectiveness of the European institutions and criticized the con- On the threshold to the EU, Bulgaria has become the scene of cerns that "someone could obstruct the process for political rea- dozens of conspicuous murders. The paradox is that the most sons." Otherwise Bucharest is much more self-critical than Sofia page notorious representatives of the criminal world walked free and and confesses that Romania still has a lot of work to do to 27 undisturbed by police and justice until their very last day. become an EU member.
Laws to repair Basescu said that there is a problem in explaining the country's progress to the European representatives. "The commissioners Under Brussels' watchful eye the Bulgarian parliament took over are acquainted with it but the members of parliament and the some key amendments to the Penal Procedure Code. It was the peoples of the EU are not. This is the key mission of the EC that urged Bulgaria to terminate the vicious practice of pros- Romanian observers in the European parliament: to explain the ecutors returning cases to investigators for further examination. progress Romania has achieved," the Romanian head of state is That was one of the reasons for dragging lawsuits and the deliv- confident. Anyway, the European Union combines 25 opinions analysis
about enlargement in 2007 and about Bulgaria's and Romania's Between "yes" and "if" readiness to join the union. It is a fact that not all nations in EU- 25 are expecting the two candidates with open arms; some are Most EU members have declared they support the accession of actually quite reserved. Bulgaria and Romania - with all their problems and unfinished reforms. Under close scrutiny Five countries have even ratified the accession treaties of the two It is also a fact that Old Europe is showing signs of fatigue and Balkan states with huge majorities. Slovakia was the first to give dissatisfaction. There is nervous tension in the EU-25: because its final "yes" to Bulgaria and Romania's membership. Hungary, of the failure of the European constitution, because of the fail- the Czech Republic, Slovenia and Luxembourg have also extend- ure to reach certain economic and financial results, because of ed their support. Other countries like Great Britain, Portugal and the noisy arguments and below-the-belt punches about EU's next the Netherlands have already assured the two Balkan countries budget. That is why Bulgaria and Romania are now under such that they will not block their way to Europe. close scrutiny. They are reviewed by the 25 member states, the European Commission, the European Parliament and a number A ratification means that the treaty has been approved by the of other institutions. France, for instance, announced that regard- last-instance authority, the national parliament, and has to enter less of the regular EU assessments it would conduct its own sur- into force as planned: on Jan. 1, 2007. vey and come up with its own report on Bulgaria's readiness for EU membership. Nevertheless, even if all member states approve the accession treaties, the entry can be delayed still. If something dramatically At the same time Sofia already has 18 pairs of eyes in the important happens, the so-called safeguard clause will defer European Parliament: Bulgarian observers already participate in Sofia and Bucharest's membership by a year. the sessions. They should use their presence their to lobby for Bulgaria as much as possible. Geoffrey van Orden, the rappor- Recently Germany sent some disturbing messages concerning teur for Bulgaria in the European Parliament, also sees another the enlargement. But the elections there have now passed and mission for Bulgaria's Euro MPs: to urge the country to take the the German politicians will be less engaged with speculations most essential measures and hurry up the government and the about the "threats" coming from the EU entrants. That was a hot authorities. topic in the fight for votes but the time for slogans is now over and the time for pragmatic policy has come. Best performer? Another constant skeptic about European enlargement, Austria, We should not forget that besides being the target of European will hardly obstruct Bulgaria and Romania's entry. Vienna's criticism, Sofia has something to boast of, too. Certain indicators reserves are actually connected with the shifting of the EU bor- in Bulgaria are even better than in some of the old EU members: ders further east. the relatively low (for the time being) inflation and the lack of budget deficit. What's ahead
Bulgaria is far ahead of France in liberalization of the energy European enlargement commissioner Olli Rehn has confessed sector. Sofia has already privatized its electricity distribution net- that some countries were waiting for the EC's October report to work and is selling power plants for foreign and private enter- decide whether to ratify Bulgaria and Romania's accession prises. treaties. The European Parliament has already announced it will begin discussion on the EC reports immediately after their pub- Furthermore, Bulgaria may introduce the Euro as early as in lication. The stand of the MEPs will be most probably voted in 2009: even before Poland, the Czech Republic and Hungary. This December. is envisaged in the Bulgarian National Bank (BNB) strategy for accession to the European Monetary Union, BNB governor advis- According to EC Vice President Franco Frattini, Bulgaria and er Kalin Hristov said. Romania have enough time to fulfill their commitments and join the EU according to schedule. The EC next report will come out Second-wave entrants like Poland, the Czech Republic and in April 2006. By then the two countries have enough time to Hungary have begun to delay they Eurozone accession. In prin- prove that they can keep their promises and progress with ciple they can replace their local currencies with the Euro in reforms, Frattini said. 2006-2007. Their central banks, however, prefer to approach 28 monetary union membership with caution. Undoubtedly, the European Commission will be tough on Romania and Bulgaria until the very end. It will show them yel- Bulgaria seems to be much more prepared to join the Eurozone low cards to keep them in productive suspense. But it will hard- because of its currency board system which guarantees strict ly set the tone for deferral of the two countries as some people financial discipline and stability in the country. When the curren- fear. cy board was introduced there were concerns that the Lev would depreciate after Bulgaria's EU entry. Today the concerns have The road to full membership is rough, no argument about that. been dispelled and according to BNB's strategy, the current rate But if Bulgaria shows that it has chosen the express train of
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria of 1.95583 Lev/Euro will remain effective until Bulgaria replaces reforms, it will disarm all European politicians who have reasons the Lev with the single currency. to dislike its accession. The same holds true for Romania. ■ analysis Turkey in EU: The Long Winding Road By Boyko Vassilev The Turks are coming.
England is persuading. France is staying mute. Austria is trying to prevent it but REUTERS agrees in the last minute. Just before them, the Croats are coming.
Yes, big politics can be retold in short sentences, just like a soccer game. But it can hardly be denied that for the past few weeks more and more people have been willing to read it this way. The European Union's decision to start membership talks with Turkey in the last moment provoked such passionate memories that awoke - throughout Europe (and mainly in its southeast part) - those who read modern political events in a 600-700-year context.
There was hardly anything they did not remember: How Stephen Runciman described young Mehmet the another crucial time for European inte- two extremes merge? Conqueror reciting a Persian poem in gration. Turkey has been waiting at front of St Sofia's alter in Europe's door for quite a long time, Otherwise the realities are clear: Turkey Constantinople; how Bulgarian historian more than anybody else, and the start of has problems recognizing Cyprus as a Vera Mutafchieva wrote in one of her accession negotiations seems inevitable. state. Turkey made steps towards rec- books how the phrase "as strong as a But not so for a large part of European ognizing the rights of Kurds and did not Turk" appeared in the European lan- citizens who are used to the idea of the even prevent the historical discussion on guages; how the bells of Notre Dame "Christian club" and putting off the time the Armenian genocide, but Kurds and mistakenly chimed victoriously after when tomorrow's 70-million power will Armenians say that is not enough. The Kosovo's Christian defeat; how Vienna, open its borders. army in Turkey is still strong and the which broke the siege, ransacked the position of today's liberal chief of abandoned Turkish army supply trains The supporters of Turkish integration General Staff Hilmi Ozkok is targeted by and discovered coffee; how Britain's know that fire is fought with fire and jux- the more hard-line head of the land 19th century was divided into Turkophils tapose the historical stereotype with forces, who is defined as a conservative and Turkophobes and how Swinburne another stereotype: the economic one. nationalist. AmCham Bulgaria Magazine October 2005 was on the one side and Tennyson on "Who would dispense with the huge the other. market?," they ask (The Economist). Is Then we add the justice system, the dif- there anything more important to aging ficult negotiations with a powerful econ- In general, history abounds in journalis- Europe than the fresh blood of a still omy and the constantly pending ques- tic leads about Turkey and the Turks. young nation? tion of whether the moderately religious The topic of Turkish integration is government of Recep Tayyip Erdogan is doomed to boiling in the cauldron of If we forget the stereotypes, the conflict sincere in its reformist intentions, says page stereotypes and myths. points that give ground to Europe's old Prof. Melen. "Erdogan's cabinet staked 29 fears today are more than well known. too much at the start of European nego- "Actually, Turkey is not at a historic Turkey may go to two extremes: tiations and it shouldn't have done so. crossroads. Long ago the country chose Kemalist nationalism (the Army, the People do not understand much and the road to Europe and is already walk- "Gray Wolves") or Islamic fundamental- these are not negotiations but pure dic- ing on it," says economist Midhat Melen ism (some new hard-line political and tate." This emphasis created enthusi- from Istanbul. The Brussels educated religious option). For the time being the asm, disappointment and then enthusi- intellectual of Turkish origin knows what two extremes counterbalance each asm again among the Turks - while he is talking about. His father, Ferit other or even oppose each other. But West Europeans are not used to the Melen, was prime minister of Turkey at what if one of them prevails? Or if the expression of strong feelings as regards analysis
anybody. Austria agreed to abandon its Bulgarians' and Romanians' own prob-
REUTERS proposal for "privileged partnership lems, however, are not a decent expla- instead of membership" but there are nation for many stages at which Brussels may halt the process. There are plenty of ways the lack of a serious for it to do so: it may pose an unfeasi- internal political debate ble condition (it's like someone drawing a door on the wall and asking you to in the two countries on Turkey's future pass through), it may require a consen- EU membership. The talk on the issue in sus on a debatable issue, it may ask for Bulgaria was left to Ataka's nationalists, enormous economic concessions. Or who readily joined in the chorus of their condition Turkey's accession on some Western counterparts. Elegantly dressed referendum. Austria and France have not in suits, the young Bulgarian nationalists given up the idea for a plebiscite, nor already walk the EU halls in Strasbourg are they going to abandon it, at any rate and even know that in Belgium Vlaams not until they are facing elections. As a Blok is now called Vlaams Belang. whole, the Turks are aware that it is still early to celebrate. "It is time for work This is not the first time the Bulgarian now," says Prof. Melen. political elite has avoided a serious dis- cussion, feeding the political periphery. "The Turks know it will But while allowance can be made for take long." Romania, Bulgaria will border - or rather merge, literally - with a future European At least as long as it takes for Europe Turkey. What is better then: Not to have to finally clarify its idea of itself and see extremists at the border? Or not to have Turkish Prime Minister Tayyip Erdogan (front R) if Turkey can wait. a 70- or 80-million economy (with all leaves Kocatepe Mosque in central Ankara, October ensuing implications) next to you, with- 5, 2005 after a prayer together with Foreign One of the winners in the turmoil turned out a threshold, without a barrier? Minister Abdullah Gul (rear C). Turkey's govern- ment defended in October a historic deal opening out Croatia. "They let us in to protect Today's Bulgarian politicians did not talks on joining the European Union against domes- them from the Turks again," a Croatian even want to raise the question in pub- tic critics who accuse it of selling the country short. acquaintance said jokingly in the tone of lic. But tomorrow they will have to tack- those historical you-know conversations, le it as part of United Europe and will Brussels. But if Erdogan makes suc- where everybody know who we are and not be able to defer it any longer. cessful national politics out of the EU who they are. The Croats are not the you involuntarily admit that only people in Southeast Europe who "Turkey will not be an aggressive eco- proudly claims that it delayed the Turks nomic or any other power," Istanbul pro- a break-up with the EU in the 14th-17th cent. But this time they fessor Midhat Melen says. The may also sell well were lucky, because Brussels turned a Bulgarian voter cannot be easily con- blind eye to the fact that general Ante vinced. Not to mention the people to within the country. East of the Zadar- Gotovina had not been caught yet and whom "Midhat" again brings historical Vukovar-Szeged-Carpathian line of mil- put Croatia on the calendar. When the memories: Midhat Pasha, a talented let ale drinkers you can make any European constitution failed in the 19th-century Ottoman statesman, an cause winning as long as you call it a Netherlands and France, there were architect of reforms and nationalism, "national" cause, even if it is interna- expectations that Brussels would give who realized that warring is not the tional. somebody a demonstrative slap. For the point; the point is that the Turks should time being, this somebody is not Croatia. learn to manufacture like the Christians. What happened actually in this pas- sionate ferment? The European Union Bulgaria and Romania do not want Bulgaria has two simple tasks to do. To is launching long and difficult negotia- slaps either. But the EU has to con- remember the EU and to build a strong tions with Turkey; negotiations that can vince both its citizens and the Turks economic and public structure within the continue for 10 or even 15 years, while that it measures by new, tougher crite- EU. the workforce market will be opened in ria. The safeguard clause could be trig- 30 yet another 20 years. Turkey has to set gered, the entry of both (or one of the How about the EU itself? Where it is up a total of 35 negotiating teams, the two) countries could be put off until headed to no one can say. The Turks pages concerning agriculture alone are 2008 and then - who knows. "The are coming, constitutions are failing, 10,000 (it's another matter whether the European Commission is our best ally," leaders are changing, historical tales are EU will give Turkey even half of the Bulgaria's European affairs minister being told again and again - the bells, generous farming subsidies provided Meglena Kuneva likes to say. But this coffee, the language, the Persian poem. so far). ally urgently needs arguments and if Bulgaria and Romania fail to provide While Europe is still confused what to
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria What is more important is that such them, they will have to blame them- do with its biggest value and problem: its negotiations have not been held with selves for that. fatal attractiveness. ■ crisis management The Floods and After Lack of state funds and private insurance will lead to the compensation of 10- 15 percent of losses By Marina Georgieva
Bulgaria was flooded five times this year. Torrential rains affected by the disaster. 900 soldiers and more than 150 mili- caused floods all over the country since the end of May. tary transport vehicles and specialized equipment will take part Currently, the number of victims of the natural disasters is esti- in the recovery operations, which are expected to be complet- mated in the thousands, and all local and central authorities are ed by October. engaged in one and the same activity - to repair dams, clean river beds and unplug clogged sewer lines. The damages to the economy are estimated at some 1.5 billion BGN. Aiming to conceal the lack of foresight, mayors and ministers embarked on endless disputes who should be blamed for the The National Forestry Authority, the Agency for Combating Hail floods. Initially, cabinet members accused the local authorities Storms, the National Veterinary Authority, the water and sewer- of failing to initiate the cleaning of the river beds and sewers. age utilities, numerous flooded schools and hospitals are all Local administrations justified their idling with the lack of funds asking for money from the budget. Municipal claims alone rose and with the absence of a comprehensive state policy on nat- to 1 billion BGN. Thus, the total amount necessary for the ural disaster management. restoration of the damages caused by the floods reached 1.5 billion BGN and continues to grow. All hopes for providing these The floods in Bulgaria affected the normal life of about two mil- funds are centered mainly on the budget. lion people and caused the death of at least 20 persons, while the homes of another 10,000 were ruined. Huge agricultural Mending the transport infrastructure will swallow the bulk of the areas and crucial infrastructure facilities were badly damaged. funds. Some 237 million BGN will be needed to restore the rail- Major road and railway communications were cut off. way network, which was barely mended after the floods which drowned the country in early July. The Ministry of Regional The situation in the country was so extraordinary that the Development announced that the repairs of the republican road armed forces were mobilized to provide help to the regions network will need at least another 130 million BGN. The bill
32 AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria North East Bulgaria suffers badly from the havy rains. crisis management
for financing the autumn sowing campaign. These funds sup- Some 582 rivers and brooks form the water-collecting plemented the planned 25 million BGN in credits and subsidies, basins of 13 major Bulgarian rivers. Hydrologists claim that the 5 million BGN allocated to those who suffered from the this system is relatively small and Bulgaria is poor in terms summer floods and the 7.5 million BGN for fertilizers. of water resources. Why then the country was flooded within hours, and some of the regions were flooded three Summer torrents seem to have revealed the overall lack of pre- times this year causing wide-spread damage and destruc- paredness in Bulgaria to manage disasters of such a scope. tion? The problem is further aggravated by the outdated infrastruc- ture and by the lack of an adequate system in place to provide Environmentalists and scientists dealing with forest ecolo- genuine assistance to the population. Just like in the not-so-dis- gy and hydrology have said that the channeling of rivers tant past, they could rely only on what the state decides to allo- into concrete beds facilitates floods. Hydrology engineers cate - which, according to many, is just a notch above nothing. and experts of the Institute of Architecture and Construction claim exactly the opposite - especially when President Georgi Parvanov stated in a special address: "It would the problem is attributed to rivers passing through popu- not be an exaggeration to say that the floods brought to the lated centers. Corrections in the river beds inside and out- surface the criminal carelessness of a number of state author- side towns and cities prevent spillovers, if the respective ities - for years on end these authorities failed to make even facilities have been properly dimensioned and are proper- the minimum of efforts to clean river beds and sewerages; the ly maintained. maintenance of dams and dykes, of pipes and shafts has been almost totally abandoned. The equipment available to authori- Natural river beds require only measures for maintaining ties - vehicles, special machines etc., is old and scarce." their throughput. That means to clear debris, to fell large trees growing in the paths of rivers, and to clear fallen and It emerged that Bulgaria has no water monitoring system what- decaying tree trunks, which might be washed down from soever, nor a system for managing the quantities of water the shores. Nobody has ever claimed that maintenance released from the dams. A multitude of specific problems requires the total cleanup of river beds from all vegetation, became apparent on the background of the whole mess of hydrological engineers retort. analyses and data - the clogged river beds, the poor manage- ment of dams, the lack of long-term forecasts and the poor Dams are one more barrier to floods. They absorb the so- coordination among institutions during a crisis. However, no one called high wave and "kill" it, spread it over a large area. has been held officially accountable and no one has assumed Bulgarian Academy of Sciences experts however claim the political and fiscal responsibility yet. that it is not sufficient to have a system of dams. They insist that some of the dams (especially those built across Budget impotence small mountain rivers) must be kept empty, in order to be capable of absorbing the high waves, which might cause According to the effective Constitution of the Republic of flood in case of torrential rains and intensive snow thaw- Bulgaria, the state is obliged to provide for the safety of its cit- ing. izens. Still, the president used the term "abdication of the state" to describe the situation after the floods in August. It is obvi- does not account for the damages to the Sofia ring-way. The ous that a new system is needed, which should incorporate pre- damages cause by floods to water and sewerage systems are vention, salvation and compensation of the people, who estimated at 5.3 million BGN. The state-owned Irrigation become victims of disasters. Systems company pleaded that the restoration of the damaged facilities will require some 25 million BGN. The disaster that At the end of its mandate, the cabinet of Simeon Saxe-Coburg- might be caused by torrential rains in the future would be much Gotha released 170 million BGN for offsetting the aftermath of more extensive, if the funds are not allocated on an urgent the floods. Of the whole, 120 million BGN were transferred by AmCham Bulgaria Magazine October 2005 basis. More than 500 schools remained empty at the beginning the recently established state-owned company Public of the school year, as the ongoing repairs were still not finished. Investment Projects. Another 50 million BGN were released from the budget surplus. The funds were distributed to the Experts of the agricultural ministry have calculated that more municipalities by the Disaster Management Commission. The than 123,000 hectares of arable land have been devastated, then finance minister Milen Velchev admitted that the amount together with a harvest worth another 20 million BGN. will most probably not be sufficient and that after it is spent, the cabinet should proceed to allocate additional funds. page Concerned about the delay of the fall sowing, Minister of 33 Agriculture Nihat Kabil has ordered an inspection of his min- The new cabinet headed by Prime Minister Sergey Stanishev, istry's budget, promising that any reserves would found and released another 9 million BGN to families, who had suffered used up. from the floods. The money was distributed on the principle that each of the affected families is eligible to receive up to 1,000 The summer rains have affected the wheat harvest, which may BGN for covering immediate needs. match the target yield in terms of quantity but at a lower qual- ity. According to Ministry of Agriculture and Forestry estimates, It is obvious that additional expenditure is needed to restore the due to low quality Bulgarian wheat will be sold mainly for fod- damages from the disastrous floods. Hence, drafting the bud- der. An additional 10 million BGN has been allocated directly get for next year will stumble on the usual obstacles, hopeful- crisis management
The construction of such houses would cost about 300 BGN per square meter. The total amount allocated to this project is set at 3 million BGN, but it will most probably be exceeded, as the houses will have to be erected on concrete foundations, and supplied with electricity and utilities. Experts estimate the price of a completed house of the type at 10,927 BGN.
Some 1,400 houses were ruined after the three waves of floods last summer, of which 300 were leveled to the ground. Currently, 211 families are homeless, after their houses were swept by the floods. Another 47 houses have been restored and people have moved back in and 80 portable homes are under con- struction. US Gives $450 000 to The US government and USAID responded as quickly as possible to the fllods disaster in Bulgaria this summer. A total amount of 450 000 USD was given to the affected areas.
The Bulgarian government reports that the cost of the dam- age is over $660 million. This number could increase as assessments are completed and relief response reveals the real scope of the disaster. USAID/Bulgaria working with the Office for Foreign Disaster Assistance (OFDA) responded The area of Ihtiman, around 40 miles from Sofia is still in danger of floods. quickly in early July with $50,000 in funds for the Bulgarian ly without encountering any exceptional circumstances again, Red Cross. This money was spent in providing among other Finance Minister Plamen Oresharski said. "We shall try to things, 25,000 litres of drinking water, 5,000 food packages, establish a control scheme for monitoring the efficient use of bedding and sanitary products. As the extent of the disas- the funds, released for offsetting the damages, in order to ter became more evident, USAID provided CARE International reduce the options for leaking money," he added. $400,000 in August for additional humanitarian assistance and flood relief. The budget expenditures used to offset flood damages were high on the agenda of the September mission of International The $400,000 was used to purchase boats; water pumps to Monetary Fund (IMF) representative to Sofia. drain flood waters from buildings and low lying areas; gener- ators to provide electricity; and hygiene and sanitary prod- It became clear however that the IMF does not approve the ucts, such as bleach, washing powder, and disinfectants. plans of the cabinet to spend more than planned on floods Information leaflets were printed and distributed to the towns damages. A natural disaster or similar events may not be used and villages containing guidelines on water disinfection. to motivate a retreat from stringent fiscal policies, said the IMF Director for Bulgaria Hans Flickenschild. After heavy rainfall ended, isolated but intense showers con- tinued to hamper relief efforts around the country, posing a The IMF is adamant that additional expenditures made to off- real threat of disease and infection. Many roads remained set damages must be made out of budget savings. Those, who closed for weeks making it extremely difficult to get to remote will not receive the expected budget funds, and whose expen- towns and villages in the western part of the country. ditures will be saved, must be carefully convinced that this CARE's staff worked tirelessly to find ways to reach the measure is initiated in view of urgent needs, Flickenschild affected areas and distribute relief supplies to the Bulgarians added. The government must think about how it could cover the who bore the brunt of these torrential rains. losses. It has already spent some funds, and will continue to do so, but it must deal only with the issues that require an On August 23, a ceremony was held at the State Agency for immediate solution. Some of the expenses incurred because of Civil Protection. Charge d' Affairs, Jeffrey Levine, formally the floods will be transferred to the next year. "We are looking presented the $400,000 in humanitarian aid to the Bulgarian 34 at the fiscal policy from a macro-economic point of view, we Deputy Prime Minister, Emel Etem, who is also the minister see it as the instrument necessary to guarantee fiscal stabili- for Natural Disaster Coordination. This came in the form of ty," Flickenschild stressed. food, water and equipment that USAID's Mission in Bulgaria through its implementer, CARE International Bulgaria. During The solutions the ceremony the Charge and USAID/Bulgaria were present- ed with a certificate of appreciation. CARE International dis- The construction of wooden houses for people, whose homes tributed relief supplies throughout the western region of the were fully demolished by the floods, will be completed before country enabling some of those affected to begin restoring
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria the beginning of winter, said Emel Etem the deputy prime min- their normal lives. ister in charge of disaster coordination. crisis management
Authorities claim that the families without home could be amount to a total of 8 million BGN. moved to houses and apartments owned by various state insti- tutions. The Ministry of Defense has pledged to help. Experts are adamant that the money released by the Standing Commission for protection of the population in case of natural A total of 1.5 million BGN, donated to bank accounts held by disasters and industrial accidents are barely enough to cover the Bulgarian Red Cross, will be distributed to 39 municipalities, the damages. The mission requires not only more money - what which suffered from the floods. is more important is to have these funds invested in activities, aimed at preventing or at least limiting the aftermath of similar Each household will receive also material donations to the disasters in the future. equivalent of 349 BGN, and the required products will be pur- chased by representatives of the Bulgarian Red Cross accord- It might help to have a government program for low-interest ing to purchase request submitted by mayors of the affected loans to farmers, dedicated to restoring farms. Small and medi- municipalities. The donations in kind and in cash from abroad um companies could be granted a tax break.
These tax relief measures may cover also small and medium Under Water Bulgaria enterprises, which were not directly affected but are operating In September, heavy rains again drenched previous flood hit in disaster regions and are engaged in restoration operations on areas of Bulgaria. The United States Government reacted the territories of flooded municipalities. swiftly contributing an additional $1 million dollars in assis- tance to the Government of Bulgaria. The $1 million will be The government must collect money from real estate owners used to help meet the most urgent priorities of the Bulgarian for compensations in case of disasters, insurance companies Government in its recovery efforts, including small vehicles, have demanded. The idea is to use the new tax to be levied and heavy equipment necessary to demolish flood-ruined on all residential properties and other buildings, including some buildings and restoration of electricity, drinking water and infrastructure projects. sewage services. The minimum appraisal amount of a house should not be lower On September 16, the US Ambassador to Bulgaria John than 20,000 BGN. The annual tax will be small, some 0.002 Beyrle, and the Deputy Prime Minister, Emel Etem, visited the percent and hence would not be equivalent to more than 30 municipality of Botevgrad which was severely hit by the BGN per year. These funds will have to be used for compen- waves of torrential rains this summer. Ambassador Beyrle sating damages caused by floods, earthquakes and landslides. and Minister Etem met to confer with Botevgrad mayor, Georgi Georgiev, and general Nikolov, head of the State It seems that not more than 10 to 15 percent of the damages Agency for Civil Protection. They surveyed the damage as incurred this summer will be compensated, as the mass practice they walked through the town. is for owners to refrain from insuring their property, while the state declares a low balance sheet value of its facilities. It is a wide- The U.S.Government through USAID was one of the first spread practice to insure municipal real estate, medical facilities donors to provide assistance in July and August to Bulgaria. and schools for an amount, which is hundreds of time lower than This was made possible by the excellent coordination of the the actual balance-sheet value, sources of the Insurers State Agency for Civil protection and USAID implementers, Association claim. If the so called catastrophic pool is created by the American and Bulgarian Red Cross and CARE force of a law, its capital will be credited by an initial installment International/Bulgaria. The total humanitarian assistance of $500,000, negotiated within a grant scheme with the World given to Bulgaria from USAID to address flooding is Bank. The fund's management will include a representative of $1,450,000. the state, of the scientific community and of the insurers. ■ AmCham Bulgaria Magazine October 2005
page 35 tourism Records and Reforms Rich nature, secluded marinas, hunting lodges and luxury hotels may attract the rich tourists By Mina Georgieva Bulgaria's uniqueness and charm are Balkan Mountains. native. More than 4,500 hunters from among the advantages boosting the Europe come to Bulgaria each year to development of tourism, professionals in Bulgaria's chance to avoid the try their luck. Having this product includ- this line of work habitually say. This ed in the catalogues of major Western potential should be exploited and adver- cliche ` of a cheap tour operators would boost substantially tised all over Europe. This would be the destination the number of foreign guests. only way to lure rich tourist to choose Bulgaria as their destination. Such lies in offering luxury to rich tourists. Surveys indicate that Europeans tend to tourists may be wooed by something They could be attracted by small mari- choose countries like Bulgaria, Turkey, unexpected and challenging. The rich nas at resorts, where guest could Croatia, Egypt and Tunisia instead of the Westerner does not like the mobs in the anchor their yachts in relative privacy. expensive Italian and Spanish resorts. street and the recreation facilities Thus, tourists will be able to cruise Too, tourism in Bulgaria develops at a designed for large masses of people. along the entire Black Sea shore and rate that is five time higher than the Affluent Europeans fly in and barely an also visit the vacationing projects. world average. hour later expect to board the yachts they have rented in advance, or to start According to informal data, the average In 2005 alone, 3,5 million foreign tourists on a hunting expedition along individual foreigner spends between EUR 500 and choose Bulgaria as their holiday desti- routes in the wilderness. They are ready 800 for a 10-day stay. Revenues from nation. The number of foreign tourists, to pay a high price but insist on a gen- foreign tourists may be increased up to who visited this country between uine experience, tour operators claim. five-fold by offering yachting facilities. January and August, was by 6.33 per- Most Europeans are enchanted by the cent more than the first eight months of nature around Cape Emine and by the Hunting tourism is another viable alter- 2004, while revenues from tourist ser-
feedback
A total of 2,780,348 Bulgarians have traveled abroad between January and August 2005, which is by 9.69 percent more than the same period of last year, the Ministry of Culture announced. Statistics however does not account for the fact that one and the same person may have crossed the national borders several times.
Turkey was the most frequently vis- ited destination. At 1,080,599, the number of Bulgarians who traveled to Turkey was by 24 percent more than in 2004. Turkey is followed by Greece, and Serbia and Montenegro, which are also the object of a substantial interest. 36 Much less Bulgarians have visited Germany and Macedonia in 2005 than in 2004.
Bulgarians have spent a total of 438 million Euro for travels abroad during the first seven months of 2005, which is by 4.7 percent more
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria than the same period of last year. tourism in Bulgarian Tourism
vices rose by 10.2 percent. The number Experts assess the rate of increase in Some 72 percent of all tourists visit of foreign tourists in August was by 7.42 the number of tourists this year as lower Bulgaria during Bulgaria for a seaside percent more than in August last year. than in 2004. At the same time howev- vacation. Another 15 to 18 percent pre- er, the share of tourists from the EU fer mountain tourism and the ski resorts, Germany topped the list for the first member states has reached 55.7 per- and all other alternatives share the bal- eight months of the year with 428,200 cent. ance of about 12 percent. It is exactly tourists from that country visiting these 12 percent that carry an enor- Bulgaria. Greece came up second, with The World Tourist Organization of the mous potential for development. 426,840, followed by Macedonia with United Nations and the European 390,512, Serbia and Montenegro with Commission on Tourism of the The so-called conventional types of 372,224, Great Britain with 285,001, European Union predict a tourism, like summer seaside vacation- AmCham Bulgaria Magazine October 2005 Turkey with 178,162, and Russia with ing and wintertime skiing are not expect- 149,131. According to preliminary data, 5-6 percent increase of the ed to grow at a high rate as they have revenue from international tourism, number of tourists reached their levels of saturation. The excluding revenues from transportation, hotel facilities along the seashore and in stood at 1.1 billion Leva for the first at European destinations in 2005. This the mountains have already been devel- seven months of 2005. means that for the time being Bulgaria oped. These facilities may witness a two is moving ahead at a slight higher rate to three times more tourists over the page Bulgaria was among the top summer than the average European levels. next several years. At the same time, the 37 tourist season destination for Russians, alternative types of tourism - rural, reli- according to data released by the bor- Branch experts stress however that it is gious, ornithological, wine, congress, der authorities of the Russian not important how many tourists visited etc. may well rely on a 50-60 time high- Federation. The number of Russian Bulgaria but how many will decide to er growth. tourists rose by 36.8 percent compared return on their next vacation. According to 2004. This is an all-time record since to 2004 data, 85 percent of all foreign Until now, the tourism authorities have the introduction of the visa regime with tourists visited Bulgaria with the idea to initiated the production of four films Russia. come back. about Bulgaria. Another five are in progress. They will cover the full spec- tourism
trum of tourist products, offered in Bulgaria. Nine clips dedicated to cultur- al, sea and winter tourism, have also One Price for Bulgarians been produced. They are broadcast on pan-European TV channels like Eurosport and Euronews as a compo- and Foreigners nent of a national advertising campaign. Payment for tourist services by all tourist facilities in Bulgaria must be unified, The films are presented at international according to the latest amendments to the Tourism Act. That is, similar services tourist forums, during working sessions must have similar prices, regardless of the customers. Any violation of this and other events in Bulgaria and requirement may bring fines of 100 Leva to 15,000 Leva. The legislative amend- abroad. ments were made in line with Bulgaria's commitments within the EU accession framework. All these steps were initiated in parallel to the development of tourist products, The amendments are designed to regulate the statute and the functions of the and to the application of the legislative new State Agency on Tourism. The Agency is an autonomous state institution, framework related to categorization, reg- which will be in charge of the management, coordination and supervision in the istration and supervision of all activities sphere of tourism. Thus, the amendments ultimately separated the tourism from in the sphere of tourism. the culture within the structure of the Ministry of Culture.
The current tendency is to convert The amendments allocate the preliminary and follow-up control in the sphere of tourism into an economic priority. The tourism. Preliminary control will be executed by the State Agency on Tourism state could barely do anything more but with the active cooperation of branch organizations. The agency will issue reg- draft the proper framework and adver- istration certificates and certificates for the categorization of tourist facilities. tising concepts with the objective to boost also the employment in this Incumbent Prime Minister Sergey Stanishev has decided that tourism should be sphere, as 98 percent of all tourist separated from culture and placed under the supervision of an autonomous assets are in private hands. agency. Now, more than 20 legislative instruments will have to be amended again.
Balkan Alliance of Hotel Associations The regulation on tourist lodges and chalets was streamlined. Tourist chalets with was established a month ago in Ohrid catering establishments were transferred into a separate tourist category with its with the active participation of Bulgaria. own symbols. Instead of receiving stars like hotels, chalets will get one, two or One of the Bulgarian representatives, three edelweiss to mark their category. Blagoi Ragin, was elected as the first president of the newly established asso- ciation. The hotel capacities of the region are comparable to that in France and it would be regrettable to under-uti- lize the available assets, Ragin said.
The new alliance was established by hotel associations in Bulgaria, Macedonia, Romania, Albania, Bosnia, Serbia and Montenegro. Turkey is also expected to join, and the union remains open also to the accession of Croatia.
While Bulgaria, Croatia and Turkey experience a genuine tourist boom, Macedonia is experiencing a crisis in this sphere, from which the revenues are still very low, Macedonian media wrote. 38 Vreme newspaper published a front- page article titled 'Bulgaria builds with Macedonian money.' The report was based on the fact that 390,000 Macedonian citizens have visited Bulgaria in 2005 alone.
The Serbian news agency TANJUG com-
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria mented that Bulgaria's tourism continues to set records this year as well. ■ committee reports
AmCham Real Estate Committee to Lobby for Amendments in Law on Term Leases On October 4th after summer holidays AmCham Real Estate & Construction Committee re-started its activity with re- evaluation of the 2005 yearend priorities to be continued in 2006. Among the lob- bying activities were put the issues con- cerning the ownership of land by foreign entities and individuals.
It is on the committee's agenda to initi- ate mandatory insurances in the new Insurance Code that is under discussion at the moment in the Parliament working with the insurance companies. The mandatory insurances include property insurance, third party liability insurance and professional indemnity insurance of brokers, valuators, advisors. The real estate committee gathered after the summer vacation on October 4th at the premises of Landmark Bulgaria. Among the guests at the meeting were Tanya Kosseva-Boshova, Committee Chairperson, Ekaterina The committee will lobby for lifting the Nacheva, Soravia Bulgaria, Boris Chernev, Rockwell/Intelpack, Anatoli Asenov, Soravia Bulgaria and David ban on lease terms exceeding 10 years. Butts, Hayhurst Robinson. A draft amendment of the Law on Term The review of legislations of EU coun- Regarding the personal income tax the Leases is prepared and formal meetings tries shows that the majority of them do committee will lobby on making the are scheduled with representatives of not accept lease terms. France, interest payments on home mortgages Legal Affairs Parliamentary Committee. Switzerland, Austria, Hungary have such tax deductible in coordination with banks The reasons to rise this topic is the ban approach to this issue. Similar approach and leasing companies. on lease terms exceeding 10 years, exists also in non-EU members. For which does not allow the tenants to instance Serbia does not have impera- The real estate committee will work with make expensive and long-term improve- tive regulations on lease terms and in World Bank on the new Land Register. ments in the rented property. other countries the lease terms are very long like Quebec, Canada where it is The main topics discussed at the meet- These arguments are stressed in the 100 years. ing were Law on Term Leases and the recent years with the increase of the Draft of Condominium Law (a copy you foreign investments interested mainly in Committee members reviewed the now can find on www.amcham.bg). long-term use of real state properties. existing Draft of Condominium Law pre- pared by Ministry of Regional develop- ment and Public Works, which in their opinion does not correspond to the busi- ness and residents' needs of such leg- islation. The Committee members AmCham Bulgaria Magazine October 2005 agreed to prepare a new draft on the grounds of other EU countries experi- ence and real business needs. A meet- ing with representatives of the Ministry of Regional development and Public Works is scheduled in order to coordi- nate the Committee suggestions and ini- page tiatives with the responsible state institu- 39 tions.
The two topics are open for discussion and suggestions. For more information and support for the AmCham Real Estate & Construction Committee activi- ties please contact Milena Milenkova, Kenny Volandes, CLRP and Martha Terzieva, Bulgarian Villas participated in the real estate issues discus- Committee Assistant at sion too. [email protected]. ■ entrepreneurship New Center Aims at Improving Business Culture A new Center for Entrepreneurship and Executive Development (CEED) launched its activities in Bulgaria this September. The Center aims to acceler- ate growth of Small and Medium sized Enterprises (SMEs) and fosters the development of true entrepreneurial cul- ture by delivering executive training course and networking events for entre- preneurs.
CEED presented its future functions at a conference "Grow Your Business: the Power of Knowledge and Networking" at the Hilton Hotel in Sofia. More than 120 participants attended the CEED opening conference including people represent- ing SMEs, multinational companies, institutional investors, consulting com- munity, business associations, govern- ment and others. Some of the keynote speakers at the event were Mr. Michael Fritz, USAID Mission Director, Herman Hagspiel from the Delegation of the EU Commission to Bulgaria and Alexander Babinov, Deputy Director of the Executive Agency for SME in Bulgaria.
Bulgarian business leaders such as Nikolay Yarmov, CEED Executive Director, is opening the conference event Sasha Bezuhanova (President of BIBA and General Director of Hewlett-Packard work. Completion of such programs ing its network with other national cen- Bulgaria), Elitza Tzaneva (Executive would make SMEs more attractive to ters such as the U.S.-Russia Center for Director of Ideal Standard), Krassen foreign investors and increase their Entrepreneurship. Stanchev (Institute for Market potential for contract work with multina- Economics) and Hristofor Burnadjiev tional corporations. By participating in CEED will provide an interactive forum (Bulagro Ltd) also participated at the CEED organized training, companies will for entrepreneurs, investors, service pro- event. learn how to raise additional capital and fessionals, academicians, and public get better access to financing opportu- policy makers to combine their energies The main goal of CEED is to strengthen nities. toward creating an environment in which SME leadership teams and entrepre- entrepreneurship can flourish and grow neurs by providing executive training to In addition, CEED will be hosting in a wide range of industries. By 40 company owners and managers. CEED "Network Learning Events" that will not employing a variety of product offerings, will be organizing series of hands-on only pursue topic driven and sector spe- including focused courses, workshops, training modules targeted toward the cific seminars, but will also provide an peer-learning events, networking oppor- needs of the functional SME managers. opportunity for entrepreneurs to meet, tunities, and entrepreneur exchange, the CEED will be offering peer-to-peer train- interact and network with fellow busi- CEED client companies will acquire ing, covering major subjects including ness people facing similar challenges practical know-how, which they can strategy, cash-flow management, mar- and successes. The Center will serve as implement immediately in areas such as keting and finance thus providing the a conduit for its members to grow their strategy development, negotiating, con-
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria managers with practical business "tools" businesses in other countries within the flict resolution, decision-making, entre- which they could apply in their everyday region and around the globe by leverag- preneurial marketing, and finance. entrepreneurship
The first two CEED training modules are since 1994 with two private equity experienced and devoted persons scheduled for October in Varna and funds - Caresbac Bulgaria and Trans- with proven skills and market knowl- Bourgas. Later this year the Center is Balkan Bulgaria Fund (TBBF). edge. planning to organize and co-host a Caresbac was funded by both USAID "Network Learning Event" on fundraising and EBRD and made total of 23 Some of the companies that have cho- and finance to provide an opportunity investments and now is fully divested. sen to work with SEAF in Bulgaria for entrepreneurs to learn how to seek TBBF operates on the market since include: out financial resources and meet with year 2000 and invested over $4.7 mil- major investors and equity funds oper- lion so far in Bulgaria. TBBF invests in ● ECOPROCESS - recycling of used ating in Bulgaria. Other future events companies oriented to high growth, automotive tires. will include sector specific seminars which are able to draw strategic ● GASCO - LPG distributor in Varna such as IT, agriculture, trade, manufac- investors' interest in the future. SEAF region. turing, etc. CEED will be organizing also can invest between $100,000 and ● JIMMY'S - chain of coffee and ice- meetings and seminars with multination- $1,000,000 in a single business. cream shops. al corporations and will partner in orga- ● MARKER - producer of notebooks nizing the Entrepreneur of the Year As a rule, the fund partners with busi- and related products for school and awards. nesses that offer: office. ● MERCURIUS - office products distrib- CEED is founded with the support of the ● High quality products and services in utor. U.S. Agency for International well defined market niche which pro- ● TELETEK - producer of security and Development (USAID) and Small vide high growth potential and sub- fire alarm systems Enterprise Assistance Funds (SEAF). stantial competitive advantages. ● Growing sales on domestic and for- For more information and contacts SEAF is a principal partner in the eign markets, as well as financial please visit our Web sites at: development and implementation of the results, which increase the share www.seaf.com CEED program. SEAF has been pre- value. www.seaf.bg sent on the Bulgarian financial market ● Management team of energetic, www.ceed.bg ■ AmCham Bulgaria Magazine October 2005
page 41
Conference opening panel (L-R): Alexander Babinov (Deputy Director, Bulgarian Executive Agency for SME), Magdalena Kowalska (Director General, SEAF Bulgaria and Croatia), Herman Hagspiel (Delegation of the EU Commission to Bulgaria), Michael Fritz (Mission Director, USAID), and Nikolay Yarmov (Executive Director CEED) member news
Soravia Opens New Business Center in Sofia Some 70 AmCham members and guests enjoyed the non-tra- ditional party atmosphere in the new Europark Business Center of Soravia Group at Tsarigradsko Chausse (4th Kilometer). Despite the fact that the center is still under construction, the guests filled the foyer with animated chatter. The center will be fully operational by the year's end.
Landmark architectural design of the center, its top location, high quality of construction and more than 8,000 sq. m of office space set new standards for efficient and convenient working premises in Sofia. The location at an important traffic junction in Sofia brings all the advantages of convenient traf-
Mr. Stamen Tassev was accompanied by his wife to the party. fic connections - it can be easily achieved by private and pub- lic transportation.
Europark is the third project of Soravia Bulgaria, after the suc- Marco Bosman Regional Manager ISI Emerging Markets and Kenneth cessful development of the International Business Center Lefkowitz, AmCham President enjoy the party atmosphere in the new business (headquarters of Globul), and Soravia Center (headquarters of center. Postbank). ■
42 AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria member news
Some 70 AmCham members and guests enjoyed the non-traditional party atmosphere in the new Europark business center of Soravia Group at Tsarigradsko Shosse 4th km. Ernst&Young: Europe Still Nº1 Investment Destination Western Europe is still the most attractive the economic expansion of the ten addi- The most dynamic sectors in Europe in economic zone for 63 percent of tional countries into the EU in 2004, inter- 2004 were automotive, with 11.6 percent European investors, while Central and national decision makers appear to have of international investment in Europe, Eastern Europe are increasingly viewed anticipated the future incorporation of and hi-tech, with 10.9 percent. Central as a "low cost" competitor for China, Bulgaria and Romania," says Guenter and Eastern Europe represent a viable concludes Ernst&Young's European Spielmann, partner with Ernst&Young alternative to China for the automotive, Attractiveness Survey, released Oct. 4. Bulgaria. consumer goods and heavy industry The survey found that Europe is still on a sectors. Decision makers overwhelming- par with its competitors as a viable zone In 2004 Bulgaria is ranked 15th in ly view the service and software sectors for investment although standing up to European market share for attracting for- as the future drivers of the Western the dual challenge of the United States eign direct investments (FDI). Bulgaria European economy. Investors would like and China in attracting foreign investors. has attracted 2.2 percent of all FDI in to see an easing of regulatory and fis- Europe, surpassing countries like Italy, cal policies to encourage investment in Despite a slight reduction in the popular- Turkey, Greece, Austria, Portugal and Europe. ity of Western Europe as an investment many others. destination among executives surveyed, it The Ernst&Young European AmCham Bulgaria Magazine October 2005 scored 63 percent on the global scale of Other key findings in Ernst&Young's Attractiveness Survey is a unique study attractiveness, (down 5 percent on last European Attractiveness Survey: which evaluates, on a year-by-year basis, year) and remains ahead of Central and the position of Europe and European Eastern Europe which have an increase 31 percent of international investment is development, both within Europe's new to 55 percent. directed towards Central and Eastern frontiers and with respect to Europe's Europe, more than France, Germany, relations with economic centers of activ- According to experts at E&Y, the rise of Spain and Belgium combined. Within ity throughout the world. page Central and Eastern Europe confirms Europe, Poland and Hungary are chal- 43 these countries' position as strong com- lenging the traditional supremacy of The survey is based on opinions petitors of China, which is said to be the Germany, the United Kingdom and expressed by over 650 senior interna- new star of foreign investment, marking France, particularly due to their competi- tional executives in interviews between an increased to 52 percent from 37 per- tiveness in terms of labor costs. In terms March and April 2005 conducted by the cent. Central and Eastern European of job creation by new establishments, market research company CSA, and countries continue to gain ground. After a six countries in Central and Eastern data provided by the Ernst&Young's slowdown in 2003, these countries have Europe figure in the European top 10, European Investment Monitor database, now attracted 31 percent of foreign headed by the United Kingdom, Poland created in 1997 and powered by Oxford investments in Europe. "Encouraged by and France. Intelligence. ■ member news
IBM's Business on Demand Aids Companies Achieve Flexibility Leading Bulgarian companies have united in the so-called Ecosystem, announced George Randelov, general manager of IBM Bulgaria, during the third annual forum of the company dedicated to IBM's Business On Demand initiative. This year partners of the IBM Forum were Visa International, SAP, Cisco Systems, Lenovo and Wincor Nixdorf. Ecosystem is among the recently emerging terms. On world- wide level its creation in a certain sector is perceived as a clearly stated involve- ment on behalf of the companies partici- pating in the Ecosystem to act as social- ly responsible institutions.
The emerging of the Ecosystem in business representatives how companies their entire information systems manage- Bulgaria was inspired by the innovative may become more flexible and competi- ment to IBM. Examples of this are two of Business On Demand solution by IBM, tive using Business On Demand. the biggest beer manufacturers introduced in Bulgaria three years ago. Carlsberg and InBev who outsourced the "As a company, which many times has The National Social Security Institute, the management of their IT systems in sev- declared its socially-responsible role, we National Revenues Agency and eral countries to IBM. have to constantly prove our society Bankservice are among the Bulgarian involvement. I am glad that only in three organizations which recently implemented Business On Demand is about the deep years we have succeeded to help our the IBM Business On Demand strategy, impact technology is having on business customers to be one step ahead, to pro- was announced at the IBM Forum. design and the re-shaping of industries. vide benefits for their customers, and feel Over the past decade, IBM's on-demand benefits themselves. IBM stands for its IBM has long traditions in supporting the business transformation efforts have role of an intersection point of business development of banking sector. On realized $17.4 billion in benefits from and technologies. I am happy that the Demand strategy has been implemented $6.4 billion in investment, while IT spend- leading players on the Bulgarian market in UBB, Hebros Bank, Bulbank, HVB ing was reduced by 31 percent, even are among our partners. This way IBM Biochim etc. IBM helped DSK Bank to while building the IT infrastructure to has the opportunity to help to an increas- build its customized strategy for the IT support new applications and processes, ing number of people," George Randelov infrastructure, based on the Service additional workload volume, and said. Oriented Architecture. One of the main enhanced functionality. "By integrating ideas of the On Demand strategy is to IBM's capabilities to deliver for clients He added that the dynamic conditions in help companies to reconsider the way throughout the supply chain, in the work- different business sectors on international they manage with the challenges they place, and at the heart of our technolo- and national scale motivate IT companies encounter while the business environ- gy infrastructure, we've become more to search for innovative solutions. IBM ment is constantly changing. One of the responsive, more focused and more Bulgaria presented to more than 400 methods is that corporations outsource resilient," Randelov said. ■
AUBG Offers Tools to Fast-forward Business Careers 44 AUBG's Executive MBA program launched in January 2003 The 5th MBA cohort will begin classes in January 2006 at has had more than 100 managers and professionals in the the AUBG Elieff Center for Education and Culture. For those program. As one of the most dynamic advanced business aspiring to a senior position, this might be the right time to programs in Sofia, it provides opportunities for students to take the next step. You have the opportunity to join 35 care- work in case analysis groups, conduct individual research fully selected professionals from the region for a four- projects, and practice their presentation skills. The result is semester, 16-course program. Influential managers from a business professional that thinks and acts effectively and more than 60 organizations and most industries have been
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria is prepared for new challenges. represented in the program so far. ■ easteuro link Bulgaria to Speed up Reforms in the Energy Sector The third annual EastEuro Link energy forum took place in Sofia, Sep. 14-15, 2005. Central and Southeast Europe ministers and government officials, investors and corporate decision makers gathered to examine the latest regional developments.
The conference provided a platform for exchange of experience and ideas on future growth of the Central and Southeast Europe (CSEE) energy sec- tor. Ivanka Dilovska, a Bulgarian deputy minister, said that the energy sector is facing challenges that need to be addressed in a tight timetable in order to comply with the European Union legisla- tion. As a deputy of Energy Minister Rumen Ovcharov, Dilovska is responsi- ble for the energy strategy and energy security. Governments representatives at the opening panel. connected with the greenhouse gas generation; regional electricity market There are no obstacles to the privatiza- quotas in order to keep the competitive- and the potential for renewable energy tion of large state-owned companies like ness of the country's coal industry, the in the CSEE. Bulgargas and the National Electric deputy minister said. She briefly Company (NEK), but they have to be described the two other priorities for Private investments in gas distribution in restructured first, she pointed out. team in the Bulgarian ministry of ener- Bulgaria were presented by Kenneth According to the European restructuring gy. One is to diversify the supplies of Lefkowitz, AmCham's president and requirements, the legal activities of pub- petrol to Western and Central Europe manager of NECA Company. Based on lic supply should be separated from the and the other is to develop appropriate the company's experience as a corpo- service operator, the deputy minister said. strategies for financing of projects with rate consultant, Lefkowitz presented the a minimum state share. usual profile of investors in the sector. The liberalization of the electricity According to his survey the international import and export market in Bulgaria Additionally at the forum were discussed investors are interested in critical mass should be resolved by the end of 2006, the development of oil and gas networks and mid-cap investors are more willing to Dilovska added. Bulgaria has to fulfill infrastructure; nuclear power generation take greenfield risk. In order to make the the Kyoto environmental assignments facilities in CSEE; hydro electrical power region attractive and develop networking it is vital to clarify the existing license policy and to introduce a new procedure AmCham Bulgaria Magazine October 2005 for an earlier deadline for purchase of tender documentation. Licensing of sin- gle key cities had to be reassessed prior to regional tenders. At the same time the approach to establishing investor size and strength is overly formalistic, Lefkowitz said. page 45 He mentioned some of the licensing objectives of the Bulgarian State Energy and Water Regulatory Commission (SEWRC): Investors should have ade- quate financial resources; procedures should facilitate participation of foreign investors; it is important to stimulate economies of scale and critical mass Excellent atmosphere with excellent attendees. through adequate size. ■ travel South Africa's World Heritage Sites - Part I By Gerhard Visser, Ambassador of South Africa to Bulgaria Given the spectacular and diverse culture, history, nature and became part of a long evolutionary journey to the present day. Wildlife that South Africa harbors, it is not surprising that five Today their fossilized remains hold many clues to our early of the globe's World Heritage Sites are found here. development, and perhaps even a key to our future.
There are two types of World Heritage Sites - cultural and nat- The Cradle of Humankind, listed as a World Heritage Site in ural - and it is not easy to get either status from the United December 1999, is the world's richest hominid site. Here Nations Environmental and Scientific Organization (UNESCO). tourists can explore the amazing finds that have led leading Natural sites must be outstanding examples that show major paleo-anthropologists and archaeologists to suggest that stages of earth's history, contain superlative natural phenome- humankind first appeared in this corner of Africa and from na or are areas of exceptional natural beauty and aesthetic there spread out to populate the rest of the world. importance. Cultural sites must represent a masterpiece of human creative genius, exhibit an important interchange of Here one can meet the famous "Mrs. Ples" and the amazing human values or bear exceptional testimony to a civilization "Little Foot," the 3.3-million-year-old skeleton that could be the which is living or has disappeared. missing link between hominids (human beings) and apes. In 1936, the Sterkfontein Caves produced the first remains of South Africa's cultural World Heritage Sites include: adult australopithecine - the scientific name for a species of human ancestor that first appeared over 4 million years ago. ● The Cradle of Humankind in Gauteng. Later, in 1947 scientists found the almost complete skull of an ● Robben Island in the Western Cape. adult female Australopithecus africanus. This was first called Plesianthropus transvaalensis, which inspired the nickname South Africa's natural World Heritage Sites include: 'Mrs. Ples'.
● uKhahlamba-Drakensberg Park in KwaZulu Natal. The Greater St. Lucia Wetland Park ● The Greater St Lucia Wetland Park in KwaZulu Natal. ● Cape Floral Region ● Mapungubwe World Heritage Site in Limpopo The Cradle of Humankind
Only 45 minutes from the famous goldfields of South Africa around Johannesburg, nested in a peaceful rural valley lies the invaluable and ancient Cradle of Humankind - a place where our ancestors once roamed. Some of these ancestors of mod- ern humans faced extinction millions of years ago. Others
The Greater St. Lucia Wetlands Park encompasses a great mix of habitats rang- ing from marine systems such as coral reefs and beaches, and coastal forests; from salt and fresh water marshes to the open estuarine waters of Lake St Lucia itself. The Greater St. Lucia Wetlands Park was declared South Africa's first Natural World Heritage Site on Dec. 1, 1999. It is considered South Africa's third largest park and extends from 46 Mapelane (near St. Lucia on the Indian Ocean coastline of KwaZulu Natal province) in the South to Kosi Bay in the North. The park has 280 km of near pristine coastline and compris- es of 328,000 hectares of exquisite scenery.
It encompasses a great mix of habitats ranging from marine The rocks around Barberton in Mpumalanga are some of the most ancient in the systems such as coral reefs and beaches, and coastal forests; world - over three billion years old. Because they are also the most accessible such from salt and fresh water marshes to the open estuarine
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria formations, NASA scientists come here to gain an idea of how life might form on waters of Lake St. Lucia itself; from lush coastal plains to the distant planets. drier woodland areas. The park is situated in the southern end music
of the Mozambique coastal plain near the towns of St. Lucia, Mtubatuba, Hluhluwe, Mkuze, Mbaswana and Manguzi. The protected area is home to the largest and southernmost pop- The Top Fender® ulation of hippos and approximately 1,000 crocodiles, as well as a wealth of plant and animal life. Females - Part II The park is already a fast-growing premier tourism destination By Snejanka Natcheva and offers a wide range of tourist activities that range from Alanis Morissette fishing, boating and bird watching, to scuba-diving, hiking and camping as well as offering outstanding photographic opportu- Alanis Morissette was born on June 1, 1974, in Ottawa, nities to the amateur and professional alike. Canada. She was one of the most unlikely stars of the mid 1990s. A former child actress turned dance-pop diva, The uKhahlamba Drakensberg Park Morissette became a worldwide success in the mid-nineties, thanks largely to her third album, Jagged Little Pill. Covering an area of 240,000 hectares, the uKhahlamba Drakensberg Park is dominated by sheer cliffs, deeply incised valleys and crystal clear rivers. It was declared a World Heritage Site in 2000 for both its natural beauty and cultural importance. The many rivers, wetlands, indigenous forests and the rolling grasslands are home to a diverse range of animals and plants, including many endemic and endangered species. The Cranes and the Blue Swallow are all critically endangered - fortunately viable populations do still exist in this area of South Africa.
In addition to recognizing the unique natural beauty of the Drakensberg, the World Heritage Site also focuses worldwide attention on park's rich collection of rock art - the last visible signs of the ancient Bushman, or San people. International recognition was granted in acknowledgement of the park's unique richness of biological diversity, its endemic and endan- gered species, its superlative natural beauty and its master- piece of human creative genius in the form of ten of thou- Alanis began playing piano and writing songs at an early sands of Bushman San rock paintings. age. As a child, she joined the cast of You Can't Do That on Television, a children's TV program. Using money that she earned on the show, Morissette recorded an indepen- dent single, Fate Stay With Me, which was released when she was ten. Alanis went on to sign a music publishing con- tract when she was 14. The publishing contract led to a record deal with MCA Canada.
In 1991, she moved to Toronto and released her debut album, Alanis. This was a collection of pop-oriented dance numbers and ballads that sold over 100,000 copies in Ocean coast in South Africa contain superlative natural phenomena and exotic Canada, and lead to a Juno Award for Most Promising fish species. Female Artist. AmCham Bulgaria Magazine October 2005 The Bushman San people are recognized as the indigenous inhabitants of the sub-continent. In centuries past they inhab- In 1992, she released Now Is the Time, which followed the ited practically the entire sub-continent, and are regarded as same musical path as its predecessor. Shortly afterwards, "embodying the essence of southern Africa's deep past". Yet Morissette moved to Los Angeles, where she met Glen there is no monument to the Bushman San people - other than Ballard in early 1994. Ballard had previously written Michael their own art. Jackson's hit Man in the Mirror, among other achievements. The two worked together on an album. The result was titled page Within the uKhahlamba-Drakensberg Park there are some 600 Jagged Little Pill, which was released on Maverick Records, 47 sites, collectively representing over 35,000 individual images. Madonna's label. Remarkably, the rock art in the park is better preserved than any other region south of the Sahara. The oldest painting on On the strength of the single You Oughta Know, Jagged a rock shelter wall in the park is about 2,400 years old, while Little Pill sold well upon its release in the summer of 1995. more recent creations date back to the late 19th century. Many Soon, the single received heavy airplay from both alternative of the sites contain scenes depicting hunting, dancing, fighting, radio and MTV, sending the album into the Top Ten and food gathering and rituals. ■ multi-platinum status. The second and third singles from Jagged Little Pill, Hand in My Pocket and All I Really Want, To be continued in the next issue kept the album in the Top Ten. music
In early 1996, Morissette was nominated for six Grammies. Melissa Etheridge Shortly after the nominations, she released her fourth single, Ironic, which proved to be her biggest success to date. Melissa Etheridge rapidly became one of the most popular Morissette won several Grammy awards in 1996, including female recording artists of the 1990s, with her husky vocal deliv- Album of the Year and Song of the Year. ery of pop-based folk-rock.
Her much-anticipated follow-up, Supposed Former Infatuation Melissa was born on May 29, 1961, in Leavenworth, Kansas. She Junkie, was released to favorable reviews in the autumn of picked up the guitar when she was just eight. Playing in local 1998 with Unplugged appearing a year later. 2002 saw the bands throughout her teens, Etheridge then attended the release of Under Rug Swept, followed by 2004's So-Called renowned Berklee College of Music in Boston, but dropped out Chaos. after a year to pursue a musical career in L.A.
Alanis uses a variety of Stratocaster® guitars, including a vin- tage white model with a Moto scratch plate and three single- coil pickups and another Strat® with a copper-sparkle finish and a bridge hum bucker. www.alanis.com/ Mary Kaye
Mary Kaye is a descendant of a Hawaiian royalty line, and more precisely, of Queen Liliuokalani, Hawaii's last reigning monarch. With her band, The Mary Kaye Trio, Mary was hot property back in 1956. The Rock 'n' Roll explosion had just happened and the band won many admirers, among them Elvis Presley and Sammy Davis Jr. During the 1950s and 1960s, Mary and her band became a regular act on the Las Vegas strip.
Mary won the accolade of being the first female artist to break
Melissa Etheridge performed at the 47th GRAMMY Awards held February 13, 2005, at the Staples Center in Los Angeles. Eventually, after acquiring a manager and a five-nights-a-week residency at the Executive Suite in Long Beach, she was signed by Island Records. Etheridge's first recorded work appeared on the soundtrack to Nick Nolte's prison movie Weeds before her self-titled debut was issued in 1988. This album was hailed by the critics, with the singer being compared to Bruce Springsteen. The album spawned a hit single, Bring Me Some Water.
Two further successful albums followed - 1989's Brave and Crazy and 1992's Never Enough. But it was Etheridge's fourth release that would prove to be her massive commercial breakthrough.
Tired of rumors and questions regarding her sexuality, Etheridge into the U.S. Billboard charts (with 1959's You Can't Be True, decided to put the speculation to rest once and for all, titling the Dear). Among her several album releases are A Night in Las album Yes I Am (1993). The album, which was produced by ex- Vegas (1955), Music on a Silver Platter (1956), You Don't Know Police helmsman Hugh Padgham, sold a staggering six million What Love Is (1957), Kookie's Love Song (1958), Too Much copies in the United States alone and had two major hits - I'm (1958), Jackpot (1959), On the Sunset Strip (1959), Up Front the Only One and Come To My Window. 48 (1960), For the Record (1961), Our Hawaii (1962), When the Idle Poor Become the Idle Rich (1964) and Night Life (1966). In 1995, Etheridge won a Grammy Award for Best Female Rock Vocalist. Back in 1956, Mary Kaye starred in a Fender® poster cam- paign, holding a blonde translucent-finish Fender® Subsequent albums sold well but failed to reach the heights of Stratocaster® with gold-plated hardware. Mary helped this par- her early 1990s output. These included Your Little Secret (1995), ticular model to become popular and has enjoyed a long and Breakdown (1999) and Skin (2001). successful career, both as a solo artist and as part of the
AmCham Bulgaria Magazine October 2005 October Magazine AmCham Bulgaria Mary Kaye Trio. Melissa plays a variety of guitars including a black Telecaster®. www.marykayetrio.com/ www.melissaetheridge.com/ ■