The week: The black-hole constellation

And you might be thinking - oh that's a small instance - but you would be wrong. First of all, Stamboliyski may be small by the standards of the local counties, but not in terms of business and budget. The annual budget is around 25 million levs and the European funding that can be procured through the municipality amounts to at least half of that. This makes Nedelev a CEO of a medium-sized company and also accountable for the lives of 20 thousand people.

And second - because this applies everywhere. There are new mayors in Blagoevgrad, Plovdiv, Pazardzhik, Varna, Pleven, Kyustendil and lots of other places. All of them will find issues like that (hopefully not as drastic as that one) in their first weeks in power. There will be empty coffers, multimillion debts, procurement problems and insider's pushback. And I'm not speculating here. You just need to listen to their first interviews and find out it's happening.

Blagoevgrad's mayor said the municipality is bankrupt. Pazardzhik has its bank accounts frozen. Plovdiv found a 16 million levs hole in the budget.

In short, Bulgaria will suddenly find itself riddled with financial black holes. It's not going to be pretty - for the Financial Ministry and for the citizens.

You see, municipalities by law can't go bankrupt, so the state has to bail them out. And so, in order to do so, many services and repairs will be cut. The money the ex-mayors gave or stashed away - they are not coming out of the Minister of Finance pockets or Stambolisyki's mayor pockets. They are coming out of our own.

That's the bill for the last decade of easy living in the shade of crumbling regulators. Hopefully we come out of it wiser.

This newsletter is helped by:

Martin Dimitrov

1. Politics this week:

Turns out, the Interior Minister can't be fired. Even though his Ministry failed spectacularly during the violent protest last week and even though he refused to hold any policemen accountable. Boyko Borissov and Delyan Peevski stood firm behind Kalin Stoyanov and it suddenly transpired that the crucial ministry was actually not entirely under the government's control. That's problematic, when you think what Stoyanov did last month, just weeks prior to the local elections: he fired 17 out of 28 local police chiefs. And we've already explained why this is the crucial Ministry before such a vote. Oh well, I guess someone didn't listen close enough.

Denkov in quotes

Thursday 23 November

Deadlock in Sofia City Council continues

The Sofia City Council failed for the second time to elect a chairman at its meeting on Monday, The next vote will be held on November 30. In order to elect a chairman of the council, at least 31 votes are needed out of 61 in the SOS, and 44 people voted in the ballot on Monday, of which only 23 members of his group WCC-DB and Save Sofia gave support to Boris Bonev. The 14-member GERB group did not participate in the vote, signaling that they were waiting to be contacted for negotiations. Oh, and if you missed our overview of the new Sofia mayor and what will he and his councilors be up to in the coming years, check it out here.

2. Economy:

Budget 2024 enters Parliament with adjustments. The revenue part will be reduced by 2.4 billion levs due to concerns that the fee for the transmission of Russian gas through Bulgaria may not be collected. Capital expenditure will also be reduced by the same amount, bringing it to 9.98 billion levs. Finance Minister Assen Vassilev also promised transparency about the investment projects that will be financed with this money. Until now, the government's capital programme has not been public - in practice, every year MPs vote on multi-billion dollar investment spending without it being clear to the public which projects it will go towards.

The long-awaited work on Hemus highway finally kicks off - from the middle

The construction of the Ruse - Veliko Tarnovo motorway will start - from the middle. The Minister of Regional Development Andrey Tsekov announced that the construction of the first 7.9 km of the highway could start as early as next week. A construction permit has already been signed. This will probably be the first motorway to start construction from the middle. The first kilometers will be built away from the Danube and away from Veliko Tarnovo - in the village of Tsenovo, as part of the bypass of Byala. The construction of the entire Ruse - Byala section will last over 5 years and the cost is 1.5 billion levs.

Figures:

of consumers in Bulgaria own a corporate bank card, with nearly 16% owning more than one card, according to a survey conducted by Alpha Research for Visa Bulgaria.

3. Business:

US semiconductor maker Broadcom said it has completed its USD 69 billion acquisition of cloud computing and virtualization company VMware (which has operations in Bulgaria), after earlier announcing it had received approval from China's anti-monopoly commission SAMR, the last competition watchdog that had to approve the deal.

Startup

The software firm co-founded by Bulgarian Georgi Dochev that develops rapid connectivity and collaboration software for the cloud and is half-based in Bulgaria, has raised a USD 75 million Series C funding round from a consortium of investors led by US fund Brighton Park Capital.

Construction

The Danube Bridge Association that consists of GBS - Infrastructural Construction and Patenginering, will repair the Danube Bridge between Ruse and Giurgu for 37.3 million levs, or 16.5 million levs more than the Infrastructure Agency planned for the works.

Precious metals

The Plovdiv-based private mint that produces precious metal investment products by processing finished raw materials into coins and medals will close the loop and begin producing gold and silver from a special alloy in its own refinery.

E-mobility

The global giant in the shared mobility sector has deployed its first electric bikes in Plovdiv. The number is fewer than 10 so far as the company tests the market in the city.

4. Energy:

The loss generated by the state gas company increased to 83.7 million levs for the first three quarters of 2023 compared to a profit of 11.9 million levs for the same period last year, according to the company's interim report for the nine months of the year. The negative financial result for the period was mainly due to the company recognising an impairment loss on natural gas injected and available at the Chiren storage facility at the end of the half-year, as well as credit losses on impairments of trade receivables.

5. Watch out for:

Another great achievement by Bulgaria's top women chess players this week. Antoaneta Stefanova, Gergana Peycheva, Viktoria Radeva and Beloslava Krasteva joined the runner-up in this year's Women's World Cup Nurgul Salimova and won the European women's chess championship in Budva. Ms Salimova also won a gold medal in the individual rankings.

Geert Wilders

The Dutch far-right leader won the country's parliamentary elections, dominated by the debate over rising immigration. The election results can be described as bad for Bulgaria, as the Netherlands is one of the two EU member states, along with Austria, that is opposed to the country's entry into the Schengen free movement zone. So far, the main opponent has been Mark Rutte, but Wilders' views are even more extreme.

Place:

The main pedestrian street in the capital takes 51st place in the ranking of the most expensive commercial streets in Europe, according to data from the traditional survey Main Streets across the World of the consulting company Cushman & Wakefield, represented by Forton in Bulgaria. Quite fancy, right?

Date:

That is when Parliament will begin the long-awaited process for changing the constitution - one of the six objectives set by the Denkov-Gabriel cabinet six months ago. Let's see where this takes the "assemblage," as the (non)coalition between GERB and WCC-DB is better known as.

Weekly moment of Zen:

Holy Peevski!

Source: MRF Press Service

As we've often pointed out, MRF leader-designate Delyan Peevski has become quite ubiquitous in the last couple of months, turning up at unexpected places, "fixing" various issues. In the latest episode of this series, Mr Peevski appeared alongside the bishops of the Holy Synod of the Bulgarian Orthodox Church, who looked happy to see him. This is likely because his party is the chair of the Budget and Finance committee in Parliament, which is expected to ensure the ample financing of the Church during the incoming 2024 budget discussions, as Mr Peevski himself promised.