A slap from across the ocean, a 4.2% drop in GDP and are there really so many vandals around here

A year down the line, everyone seems tired and angry and attitudes - both those of the public and officials - are more blurred.

Except, that is, the government, which entered into campaign mode and tuned up its already high-pitched self-congratulation.

"In Europe they already talk about the Bulgarian model [for the management of the pandemic] for several reasons. Our country achieved the best results in infection and death rates by imposing much lighter restrictions than other countries," Health Minister Kostadin Angelov said on Sunday, while his colleague from the Foreign Ministry, Ekaterina Zaharieva, went even further and said that not merely Europe, but the world talks about the "Bulgarian model."

In fact, as Kapital Insights wrote on Thursday, the country is experiencing a needless return to the wave of infections that engulfed it last November and December in what is clearly an attempt to keep restaurant owners and workers on side before the election. There is, of course, no such thing as a "Bulgarian model" regarding the coronavirus: the authorities pay lip service to rules but look the other way when they are breached. If this is a model, then it serves the Bulgarian state in far more fields than pandemic control - as shown below.

POLITICS THIS WEEK

US, we're still good?

Bulgarian-US relations have definitely been more than active over the past two years, but they have been characterized by well, let's call it a somewhat commercial flavor. Since the decision to purchase a new batch of Lockheed Martin's F-16s, Bulgaria suddenly started catching Russian spies and promised to involve Washington in new energy projects. Armed with this contract, with the approval of the ex-president Trump and with lots of its usual promises, the Borissov government was hoping DC was not going to pay much attention to old-fashioned and rather tedious things like, you know, the rule of law.

And yet, surprise, surprise. Last Friday, the US Senate Foreign Relations committee published a statement decrying the "persistent corruption, declining media freedom, politicization of the judiciary, and other threats to the rule of law" in Bulgaria, adding that they pose serious challenges to the bilateral relationship. Issued by Democrat Senate Foreign Relations Committee Chairman Bob Menendez and Republican Committee member Jim Risch, the position hailed "robust and growing" bilateral relations, especially in security and energy, but warned of declining press freedom as recorded in media freedom indexes.

Three stages of GERB: denial, anger, bargain

This unexpected slap surprised GERB so hard right before the elections that it ransacked its closet of semi-forgotten faces and pulled out ex-foreign minister Daniel Mitov. Together with the current deputy-Foreign Minister (and leader of GERB-youth) Georg Georgiev they called a press conference and waved printed screenshots of the Senate's website, claiming no such position exists officially.

After it turned out that the position is indeed official, the anger came - various pro-GERB talking heads took to government mouthpieces, claiming the stance was the work of Bulgarian lobbyists, allegedly working for ex-GERB strongman Tsvetan Tsvetanov.

Finally, GERB reached the state of bargaining when they discovered that there is, for a fact, lobbying involved - but likely not by Mr Tsvetanov. On Wednesday, the Foreign Lobby Report website published an outline that said "the lobbying campaign to highlight Bulgaria's democratic backsliding is showing results".

Bobokovi brothers strike back

According to the report, the senators were informed of the situation in the country by ex-envoys to Sofia James Pardew and Rod Moore in a conversation organized by Alexandria Group International lobbying on behalf of Bulgarian business owners Plamen and Atanas Bobokobi, who are under investigation in the country. That actually gave GERB a breathing space: they knew who set them up and did not have to respond in substance to the allegations.

No love for the prosecution yet again

This week in State Prosecution debacles the European Union Court ruled that European Arrest Warrants issued by the Bulgarian institution ought not be carried out by other member states. The reason? According to the court, under Bulgarian law, neither the prosecutor's decision ordering the detention of a requested person nor the European arrest warrant issued by the same authority are subject to judicial review before the requested person is surrendered. The introduction of judicial review of prosecutorial decisions has long been part of the much needed reform of the prosecution that the EU rule of law watchdog, the Venice Commission, has been calling for in order to make the institution less Soviet-like and more accountable.

Again, what about that press freedom?

The watchdog's proposal came after two years of silence following a meeting between the representatives of the organization in 2019 in which Mr Borissov promised to make media freedom a priority.

Photographer: Capital weekly

Good place to be a woman

On 8 March, Bulgaria headed - for once - a positive ranking. According to a list of the "best countries in Europe for women to work," made by the Reboot Online digital marketing agency, Bulgaria is the best place in the continent for women to succeed, ahead of countries normally considered much more emancipated, such as Sweden and Norway. The survey, based on Eurostat data for maternity leave benefits, women in leadership positions and financial opportunities, triangulated that Bulgarian women lead their European peers due to their long maternity leave (up to two years) and a significant percentage of women in senior roles.

And a good place to be a vandal

Photographer: Eurostat

The other ranking that Bulgaria topped this week is not so encouraging. According to a Eurostat survey, one fifth of Bulgarians reported they faced a problem of crime, violence or vandalism in their local area, almost twice the European ratio, which stands at 11 percent. 20.2 percent of locals complained of vandalism and crime, compared with Greece (16.9 percent) and the Netherlands (16.3 percent) who were behind. Curiously, other Balkan and Eastern European states reported the lowest levels of complaints, with Croatia (2.7 percent), Lithuania (3.2 percent) and Poland (4.4 percent) at the bottom of the ranking. All this begs the question - are we suffering more, or just complaining more?

The growth rate is mostly due to government expenditure - up by 9%. Household purchases also reported growth but at a much more moderate rate - 0.9% compared to 2019.

Dress well for January

January marked a growth point for many, the data showed. The best performers were clothes and shoes retailers with 37% growth compared to December, yet this is still 25% below last January. E-commerce, on the other hand, is 23% higher on an annual basis, but 15% lower than December.

Third time unlucky: an unattractive yield cancels t-bond sale

The Ministry of Finance rejected all orders in Monday's 10-year T-bond auction because the yield demanded by investors turned out to be slightly higher than anticipated. The state offered securities for 200 million levs (102 million euro) from the 10-year issue, which was opened for the first time in mid-February. Then, the government sold bonds for 300 million levs at a weighted average yield of 0.14%. Now, judging by the BNB data, the interest was weaker, and the achieved yield would have been higher by about 10 basis points.

BUSINESS

Information technology

The Hungarian startup Codecool is planning to open an IT school in Bulgaria this year. The company completed its third investment round, attracting 7 million euro. With the investment, the startup, founded in 2014, plans to expand its network in Central and Eastern Europe. Codecool already has five IT schools in three countries - Hungary, Poland, and Romania, and plans to raise that number to 10 by 2024.

Utilities

The Commission for Protection of Competition (CPC) has allowed Aresgaz, owned by Italian AchegazApsAmga, to acquire Bulgarian company Atlas Utilities, which is engaged in water supply and construction of water and sewage networks. The deal will allow Aresgaz, which deals with the construction and management of gas distribution networks, as well as with the transmission, distribution, and supply of natural gas, to expand its network to the territory of the municipality of Varna, the country's third-largest city.

Technology

The BDB Fund invested 6.5 million levs in IPS for a 3% stake in the tech company. The funding is in the form of a capital increase and will be used for R&D and business expansion in Saudi Arabia and the United States. This was announced by the global entrepreneurial network Endeavor, of which the executive director of IPS Alexander Rangelov is a member. IPS develops solutions for autonomous power supply of remote sites, which are based on its Exeron technology. The new focus in R&D is smart grids, designed for regions with developed infrastructure, and, in practice, provide decentralized electrification.

Stock Exchange

Tech companies are occupying Sofix. The main stock exchange index will include Alterco and Telelink Business Services following its spring rebalancing on March 22, according to an announcement of the Management Board of the Bulgarian Stock Exchange. The Albena Tourist Association will also rejoin the companies that make up the index. They will replace Monbat, Stara Planina Hold and Trace Group. Currently, the only representative of the IT sector in Sofix is Sirma Group, which will retain its place.ENERGY