08.03.2023
EUROSTAT REPORTS LOWER UNEMPLOYMENT IN OUR COUNTRY
Unemployment in the European Union in January 2023 remains at the same level as in December 2022 - 6.1 percent. It is down from January 2022, when it was 6.3 percent, according to the latest Eurostat data.
In the Eurozone, seasonally adjusted January unemployment also remained at the December 2022 level of 6.7 percent, down from January 2022's 6.9 percent.
In Bulgaria, seasonally adjusted unemployment in January 2023 (3.8 percent) decreased compared to the previous month – December 2022 (4.0 percent). Our country ranks seventh in terms of lowest unemployment together with Hungary.
127,000 people were registered as unemployed in our country in January this year, and in December they were 133,000.
In November 2022, unemployment in our country was 3.9 percent.
Youth unemployment in the country (persons under 25 years of age) in January 2023 decreased to 8.6 percent (about 13 thousand people), seasonally adjusted, at 8.8 percent in December 2022.
On an annual basis, youth unemployment in Bulgaria is decreasing significantly, and in January 2022 it was 13.6 percent.
According to Eurostat estimates, 13.227 million people in the EU, of which 11.288 million in the euro area, were unemployed in January of this year. Compared to the previous month (December 2022), the unemployed in the European Union decreased by 318,000 people, of which 220,000 in the euro area.
The EU countries with the lowest number of unemployed persons in January 2023 were the Czech Republic (2.5 percent), Poland (2.8 percent), followed by Germany and Malta (with 3 percent each).
Unemployment remains highest in Spain (13.0 percent) and Italy (7.9 percent). Data on unemployment in Greece in January 2023 are not available, and in December 2022 it reached 11.6 percent, notes Eurostat.
07.03.2023
9.6% IS UNEMPLOYMENT IN THE TERRITORY OF VIDIN, VRATSA AND MONTANA REGIONS IN JANUARY 2023
On the basis of the NSI census of the economically active population from 2011, which the Employment Agency uses until now for the purposes of its statistics, the level of registered unemployment in the three regions - Vidin, Vratsa and Montana in January was 9.6%. Thus, in the dynamics on an annual basis, a decline is observed, which for this January is 0.6 points. NSI data from the new census of the economically active population from 2021 introduce a change in the level of registered unemployment. Thus, for the month of January, it changed by 2.6 percentage points – up to 12.2%.
The total number of unemployed in the labor offices at the end of January was 16,654, which is an increase of 176 compared to the number in December. The newly registered unemployed in January were 1,759. They are 1,156 less than the previous month. Another 55 people from the groups of jobseekers employed, students and pensioners also registered with the employment offices during the month.
The number of unemployed people who started work in January was 988. 19 persons from the groups of pensioners, students and the employed also found work through the employment offices. During the month, the largest share of those who started working in the public administration sector - 22.5%, followed by those in the processing industry - 13.1%, trade - 10.3%, human health care and social work - 9.3%, construction - 4.5%, hotels and restaurants – 4.3% and others.
173 unemployed persons from the risk groups were appointed to subsidized jobs during the month - 11 under employment programs and measures and 162 - under schemes of the Operational Program "Human Resources Development".
During the month, 3 unemployed persons completed the training started in previous months, having acquired a new professional qualification.
Claimed jobs on the primary labor market in January were 812. The most vacancies in the real economy were claimed in government (29.9%), followed by manufacturing (27.5%), education and human health and social work (8.1%) ), trade (7.3%) and transport (4.8%).
The most sought-after professions during the month are: tailors and ironers; installers; seller-consultants; nurses, doctors, laboratory workers; laborers; machine operators; teachers; operators, automotive component manufacturing; drivers; personal assistants and social workers; production line operators; valets; packers; accountants, etc.
06.03.2023
BNB EXPLAINS HOW OUR MONEY WILL CHANGE INTO EUROS
BNB publishes answers to the most important questions related to our savings and loans in connection with the adoption of the euro.
What is the Eurozone?
The Eurozone is an association of those member states of the European Union (EU) that have adopted the euro as their national currency. A common currency, a single monetary policy aimed at price stability and the coordination of economic and fiscal policies are the key features of Economic and Monetary Union. All the newly joined EU member states participate in the Economic and Monetary Union with a derogation regarding the common currency and the single monetary policy until the moment of their accession to the Eurozone (with the exception of Denmark), with which they become full participants in the Economic and Monetary Union.
When the euro was first introduced in 1999 – initially for cashless payments in trade and financial transactions – the eurozone was made up of 11 of the then 15 EU member states. The number of participating countries increased to 12 on 1 January 2001 with the accession of Greece, just one year before the appearance of the available form of the euro as banknotes and coins. On 1 January 2007, Slovenia became the 13th member of the Eurozone, followed a year later by Cyprus and Malta, by Slovakia on 1 January 2009, Estonia on 1 January 2011, Latvia on 1 January 2014, Lithuania on 1 January 2015 and Croatia on 1 January 2023.
All EU member states have the obligation to join the eurozone when they fulfill the necessary conditions for the introduction of the euro, until then they participate in the Economic and Monetary Union of the EU as a member state with a derogation. The only exception is Denmark, which has a right of non-participation specified in a protocol annexed to the Treaty, although the country may introduce the euro if desired in the future.
Andorra, Monaco, San Marino and the Vatican have adopted the euro as their national currency under special monetary agreements with the EU and can issue their own euro coins within certain restrictions. Montenegro and Kosovo have also adopted the euro as their national currency, but by unilateral acts. As none of the six countries are members of the EU, they are not part of the Eurozone.
Which countries are part of the Eurozone?
The member states of the Eurozone are 20 and these are: Austria, Belgium, Cyprus, Germany, Greece, Estonia, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Portugal, Slovakia, Slovenia, Spain, France and Croatia.
What is the European Central Bank?
According to the Treaty on the Functioning of the European Union, the European Central Bank and the national central banks of all EU member states, whether or not they have adopted the euro, form the European System of Central Banks. With the accession of Bulgaria to the EU on January 1, 2007, the Bulgarian National Bank is part of the European system of central banks.
The European Central Bank and the national central banks of the member states whose currency is the euro together make up the Eurosystem.
The European Central Bank was established as the center of the Eurosystem and the European System of Central Banks and is based in Frankfurt am Main, Germany. The European System of Central Banks and the Eurosystem will exist in parallel as long as there are EU member states that have not adopted the euro as their currency.
The main objective of the Eurosystem is to maintain price stability, preserving the value of the euro. By maintaining low, stable and predictable levels of inflation, the aim is to assist citizens and businesses in planning their savings and spending. The goal is that tomorrow people will be able to buy as much with their money as they can today. Through its Governing Council, the European Central Bank determines the monetary policy for the entire eurozone - a single monetary authority with a single monetary policy and the main objective of maintaining price stability.
The European Central Bank contributes to the security and stability of the European banking system, develops and issues euro banknotes, manages and maintains the normal functioning of payment systems, contributes to the preservation of financial stability.
What are the criteria for accepting the euro?
Achieving nominal and sustainable convergence is the condition for membership, according to the EU Treaty, which our country must fulfill. The achievement of such convergence is determined by the fulfillment of the criteria for membership of the Eurozone defined in the Maastricht Treaty, namely:
Along with the implementation of legal, economic and structural measures to strengthen the competitiveness and sustainability of the economy, the path to the smooth adoption of the euro is also connected with in-depth planning and practical preparation for the adoption of the single currency by both the administration, businesses and citizens.
What are the benefits of the euro?
The euro offers many benefits to the citizens, businesses and economies of the countries that use it. Some of them are:
Many of these benefits are interrelated. For example, economic stability benefits the economy of an EU country as it makes it easier for the government to make strategic long-term decisions. But economic stability also benefits businesses, as it reduces uncertainty and stimulates investment. This, in turn, benefits the citizens due to increased employment and better quality jobs.
Who is responsible for the coordination of Bulgaria's preparations for the introduction of the euro?
The Coordinating Council for the Preparation of the Republic of Bulgaria for Eurozone Membership (hereinafter referred to as "the Council") is responsible for organizing, coordinating and monitoring the practical preparation of the Republic of Bulgaria for Eurozone membership. The Council is also responsible for the development, implementation and, if necessary, the updating of the National Plan for the introduction of the euro in the Republic of Bulgaria.
Among its functions are also the approval of documents, activities and initiatives related to the preparation for the adoption of the single European currency, as well as periodic reporting to the Council of Ministers on the progress of the preparation. The Council was established back in 2015 (by Decree No. 168 of the Council of Ministers), and its activity was resumed after the accession of the Bulgarian lev to the Exchange Rate Mechanism II.
The Council is jointly chaired by the Governor of the Bulgarian National Bank and the Minister of Finance, who is the national coordinator of the preparation of the Republic of Bulgaria for membership in the Eurozone.
Members of the Council are:
Where can I find complete and accurate information about the introduction of the euro in Bulgaria?
The website for the euro, which will start operating from the end of March 2023, will be the main institutional channel for informing citizens and businesses about the introduction of the euro in Bulgaria. It will publish information аbout:
Information will also be available on a dedicated toll-free phone line, which will be revealed later. A mobile application is also planned to be developed. Its function will be to inform and provide an opportunity to calculate the value of goods and services from BGN to EUR and vice versa.
A comprehensive communication campaign will be conducted to inform citizens and businesses about the introduction of the euro. Various channels will be used to inform the public: TV channels, radio, social networks, online and print media, etc.
At what rate will leva be exchanged for euros after the introduction of the euro in Bulgaria?
The exchange of the left c epo will take place at the current exchange rate of BGN 1.95583 for 1 epo. The commitment of the Bulgarian authorities for our country to join the eurozone only with the current fixed exchange rate has been confirmed both in the National Plan for the introduction of the euro in the Republic of Bulgaria, adopted by the Council of Ministers in May 2022, and in the Decision of the National Assembly of 27 October 2022.
What does conversion from BGN to EUR mean?
Currency conversion means the physical exchange of levs in cash for euros and the recalculation of prices, deposits, loans, financial instruments and other balance sheet items from levs to euros. The conversion will be carried out through the application of the irrevocably fixed exchange rate of BGN 1.95583 per 1 euro, which will be confirmed by amending Regulation (EC) No. 2866/98 of the Council of 31 December 1998 on exchange rates to the euro of currencies of the Member States adopting the euro.
The conversion of prices and currency units from BGN to EUR will be done by applying the full numerical value of the fixed conversion rate, i.e. using all five decimal places. The resulting amount will be rounded to two decimal places based on the third decimal place according to the following mathematical rounding rule:
Recalculation of prices at a rate other than the fixed exchange rate is not permitted. The imposition of additional fees and commissions for the recalculation on users will not be allowed.
How will the accounts be converted from BGN to EUR?
From the date of Bulgaria's membership in the Eurozone, all types of accounts: current accounts, deposit accounts, current budget accounts, savings accounts, collection accounts, liquidation accounts and other accounts in local banks, as well as payment accounts with other payment service providers (payment institutions and electronic money companies) will be converted to Euro once, automatically and free of charge. There will be no transition period for these accounts. This means that from the very first day of adoption of the euro, account holders will be able to withdraw only euros from their leva accounts, regardless of whether the withdrawal will be made through an ATM/POS device or at an office of the payment service provider (bank, payment institution or electronic money company). This is a fast and convenient way to exchange BGN with EUR without any special commitment for the account holder himself. From the first day of the introduction of the euro, non-cash payments will only be made in euros.
With the introduction of the euro, does the lev immediately cease to be legal tender?
During the first one month from the date of the introduction of the single European currency in the Republic of Bulgaria, the lev and the euro will be in circulation at the same time, and both currencies will have the status of legal tender. After the expiration of this one month, the euro will remain the only legal tender in Bulgaria.
The one-month transition period will help ensure a gradual transition to the new currency. During this one month, citizens will be able to pay in both currencies at retail outlets and service centers. On the other hand, merchants must return change to their customers exclusively in euros unless they cannot do so for practical reasons. Thus, in practice, part of the levs in circulation will be exchanged through merchants and persons providing services, thereby providing another exchange channel for Bulgarian citizens. At the same time, in implementation of Council Regulation (EC) No. 974/98 of May 3, 1998 on the introduction of the euro, a rule will be adopted according to which, in this transitional period, the merchant may not accept more than 50 pieces of leva coins and pennies in within a transaction with the buyer.
How will money be exchanged between accounts?
The conversion of bank accounts from BGN to EUR will take place on the day of the introduction of the euro. All funds in BGN on current, deposit, savings and other accounts in local banks and other payment service providers will be converted into euros free of charge on the day of the introduction of the euro. Therefore, in the months after the decision of the Council of the EU that Bulgaria meets the conditions for adopting the euro and before the introduction of the euro, citizens will be invited to deposit as many leva banknotes and coins as possible in bank accounts. Starting from the day of the introduction of the euro, all non-cash payments in Bulgaria will be made only in euros.
How will the cash be exchanged? Where and when will it be possible to exchange levs for euros after the introduction of the euro in Bulgaria? Will there be a fee?
From the date of the introduction of the euro, the Bulgarian National Bank will exchange for free, in an unlimited quantity and without a time limit, banknotes and coins from levs into euros at the official exchange rate of BGN 1.95583 for 1 euro.
During the first six months from the date of introduction of the euro in Bulgaria, banks and "Bulgarian Post" EAD will exchange banknotes and coins from levs into euros at the cash desk free of charge at the official exchange rate.
In the next six months, banks will continue to exchange banknotes and coins from levs to euros, but they will have the right to charge a fee for this service.
After the expiration of the first 12 months of the introduction of the euro, banks and "Bulgarian Post" EAD may suspend the service for exchanging banknotes and coins from levs to euros in cash.
How long will it be possible to pay with BGN?
During the first one month from the date of introduction of the euro in Bulgaria, the lev and the euro will be in circulation at the same time, and both currencies will have the status of legal tender (the so-called period of dual circulation of the lev and the euro). After the expiration of this one month, the euro will remain the only currency of our country.
If I pay in levs, do they have the right to refund me in euros and vice versa?
In the first month of the introduction of the euro, citizens will be able to pay in both currencies at retail outlets and service centers.
During this period, merchants will have the obligation to return the change to their customers only in euros. Only in case of objective impossibility, the trader will have the right to return the balance in cash in BGN or in BGN and Euro. In this way, another exchange channel will be provided for replacing the leva with the euro and for withdrawing the leva from circulation.
Pursuant to Council Regulation (EC) No. 974/98 of May 3, 1998 on the introduction of the euro, a rule will be adopted according to which a merchant may not accept more than 50 BGN coins, including pennies, in that one month. within a transaction with the buyer.
When will the prices start to be indicated in euros?
One month after the Council of the EU decides on the adoption of the euro in the Republic of Bulgaria, a requirement for mandatory labeling of prices in both BGN and EUR will enter into force. This obligation will continue to apply for 12 months from the date of adoption of the euro.
From when will double labeling of prices in euros and leva be introduced?
It is planned that the obligation for double labeling of prices will come into effect one month after the Council's decision to adopt the euro in the Republic of Bulgaria and will remain in force 12 months after the adoption of the European currency. The experience of the Member States that recently adopted the euro shows that this obligation has produced very good results. It has helped prevent price gouging by allowing consumers to easily identify merchants and other businesses who have illegally inflated prices.
Special attention will be given to merchants and service providers who should display the prices of their products and/or services in both currencies during the dual pricing period. In the same period, the indication of prices in levs and in euros should also be done in the advertising materials containing information regarding the prices of the advertised services and/or products.
Double labeling of prices will also apply to public authorities. During this period, all sums owed by Bulgarian citizens to the state, including taxes, fees, etc., should be indicated in BGN and EUR. The same applies to the amounts owed by the state to citizens. Public authorities should also prepare information materials in relation to dual pricing and price lists in which prices are written in both currencies.
How will merchants return change from the day of the introduction of the euro?
In order to facilitate the introduction of the euro, during the first month from the date of Bulgaria's membership in the eurozone, the change in case of payment in cash, regardless of leva or euro, should be paid by merchants only in euro, unless for objective reasons this cannot be done. For this purpose, companies and traders will be supplied with euro banknotes and coins even before the date of introduction of the euro. The rule will also apply, according to which in the transitional period of circulation of the two currencies, the trader will not be obliged to receive more than 50 coins in BGN, including cents, in one transaction.
Will the replacement of the leva with the euro double the price of goods and services?
Replacing the leva with the euro will not lead to a double increase in the price of goods and services.
The method of converting the prices of goods and services will be regulated in the Law on the introduction of the euro in the Republic of Bulgaria. There it will be expressly provided that the conversion from BGN to EUR will be done by dividing the price in BGN by the full numerical value of the official exchange rate with all five decimal places. Conversion by using an abbreviated form of the official exchange rate will not be permitted. After conversion, the resulting amount will be rounded to two decimal places based on the third decimal place according to the following mathematical rounding rule:
A long period of double marking of the prices of goods and services is also foreseen, in order to avoid the speculative rise in their prices as a result of the introduction of the euro. This period will begin one month after the adoption of the Decision of the Council of the European Union on the introduction of the euro by the Republic of Bulgaria and will be in force 12 months after the date of the country's admission to the eurozone. The purpose of the introduction of the dual designation obligation is easier adaptation of citizens to the new currency and prevention of abuses and speculative price increases.
In the EU Member States that recently adopted the euro, dual pricing has proven to be a successful measure in countering the price increases resulting from the introduction of the euro.
In order to encourage honest traders, the Ministry of Economy and Industry, together with the Commission for Consumer Protection and representatives of non-governmental organizations, will organize an "Honest Trader" campaign with a clearly recognizable campaign logo. Those traders/service providers who comply with the rules for accurate price conversion of their products/services from BGN to EUR, as well as for comprehensible and correct indication of prices during the dual pricing period, will receive an "Honest Trader" sticker, to inform users that they are participating in the campaign. The institutions - organizers of the campaign - should be responsible for monitoring the good practices of traders, and citizens will be invited to participate in the process of collecting and transmitting information.
Will inflation rise after the introduction of the euro?
The experience of the countries that recently joined the Eurozone shows that the immediate effect of joining the Eurozone on price levels is in the order of 0.3-0.5% increase in inflation. At the same time, it should not be forgotten that due to the catch-up economic effect and lower prices in Bulgaria compared to the EU, as well as as a result of the increase in energy prices and geopolitical upheavals in the last year, inflation in our country is growing.
The introduction of the euro is expected to have a minimal effect on price increases. If we take as an example the Republic of Croatia, the latest country to join the Eurozone at the moment, we will see that according to Eurostat inflation in Croatia for January 2023 rose by 0.2%. Annual inflation in January 2023 is 12.5%, in December 2022 – 12.7%, and in November 2022 – 13%.
The effect of the changeover to the euro on headline inflation in Slovenia was 0.3, in Slovakia – 0.15, in Estonia – 0.3, in Latvia – 0.2 and in Lithuania – 0.11 percentage points.
Who will monitor fraud and penalize abuse?
The Bulgarian National Bank and the Commission for Financial Supervision, in accordance with their powers, will monitor compliance with the requirements by their supervised entities - banks, insurance and pension companies, etc.
The main authorities regarding the control and sanctioning of abuses by traders related to the introduction of the euro will be: the Consumer Protection Commission, the Competition Protection Commission, the National Revenue Agency and the "Economic Police" sector of the Ministry of Internal Affairs. Every citizen will have the right to report violations to the Commission for Consumer Protection or to the relevant supervisory authority.
Merchants who willfully violate the conversion or rounding rules will be penalized according to applicable law.
Where will I be able to report if I come across unfair traders?
Reports will be able to be submitted via the website of the Commission for Consumer Protection, on the euro page, as well as via the free euro telephone line, which will be opened 6 months before the date of introduction of the euro.
After exchanging the leva for my salary, if it is 1,500 leva, will it automatically become 1,500 euro?
Salaries will be paid in euros after the date of introduction of the euro. The amounts in the employment contracts should be converted in favor of the employee by rounding the amount to the nearest euro cent. If the sign that follows the last sign to which rounding is done is greater than 0, one unit should be added to the last sign or a new amount will be determined, the value of which is not lower than that in BGN. Thus, during the conversion, the amount of BGN 1,500 will become 766.94 euros, and it is possible for the employer to round it up to 767 euros.
What will happen to my savings in the bank, which are in BGN?
From the date of Bulgaria's membership in the Eurozone, all accounts - checking, deposit, savings and other accounts in local banks will be converted into euros once, automatically and free of charge.
There will be no transition period for these accounts. This means that from the very first day of adoption of the euro, account holders will be able to withdraw only euros from their leva accounts, regardless of whether the withdrawal will be made through an ATM/POS device or at the office of a bank, payment institution or electronic money company.
This is a quick and extremely convenient way to exchange BGN for Euros without any special commitment for the account holder himself.
From the first day of the introduction of the euro, non-cash payments will only be made in euros.
If I have more than BGN 10,000 saved and they are not in the bank, how can I exchange them into euros after the introduction of the euro in Bulgaria?
In the months leading up to the introduction of the euro, citizens will be encouraged to deposit as many leva banknotes and coins as possible into bank accounts. Considering that all BGN funds on the accounts will be converted free of charge into Euros on the date of introduction of the Euro, starting from that day, cashless payment transactions will be carried out only in Euros.
From the date of the introduction of the euro, the Bulgarian National Bank will exchange for free, in an unlimited quantity and without a time limit, banknotes and coins from levs into euros at the official exchange rate of BGN 1.95583 for 1 euro.
During the first six months from the date of introduction of the euro in Bulgaria, banks and "Bulgarian Post" EAD will exchange banknotes and coins from levs into euros at the cash desk free of charge at the official exchange rate.
In the next six months, banks will continue to exchange banknotes and coins from levs to euros, but they will have the right to charge a fee for this service.
After the expiration of the first 12 months of the introduction of the euro, banks and "Bulgarian Post" EAD may suspend the service for exchanging banknotes and coins from levs to euros in cash.
How will taxes be paid after the introduction of the euro in Bulgaria?
With the introduction of the euro, all taxes, fees and other payments to the state and municipalities must be made in euros. An exception to this rule will be made during the period of dual circulation of the leva and the euro, i.e. one month from the date of introduction of the euro.
After the date of the introduction of the euro in Bulgaria, the refund of amounts unduly paid or collected before the introduction of the euro for taxes, state or municipal fees, mandatory insurance contributions, fines and property sanctions, and other public obligations, will be carried out in euros.
Amounts on tax returns will be stated in the currency that was legal tender at the end of the tax period for which the tax return is submitted. When the tax period for which the declaration is submitted ends in the period of double circulation of leva and euro, the monetary values in the tax declaration should be indicated in euros.
With the adoption of the euro, will the contracts change?
In the process of introducing the euro, the principle of continuity of contracts will be applied. This means that:
I have a home loan in euros. Can the bank request a renegotiation of its terms after the introduction of the euro?
From the date of the introduction of the euro, all loans originally granted in BGN or loans with a currency clause in euro will be considered as loans in euro. The introduction of the euro will not be allowed to be used as a condition for the renegotiation of clauses in contracts already concluded between banks and their customers or as a basis for other similar actions by banks in relation to their customers that would put them in a less favorable financial position relative to their position before the revaluation.
This will also apply to non-bank financial institutions that provide loans to customers.
If I buy a gift voucher shortly before the date of introduction of the euro and it remains unused until that date, will it be lost?
Postage stamps, lotteries with a predetermined result, discount coupons, coupons for the value of returned goods, vouchers, including food vouchers and other bearer securities which were on sale or in circulation before the date of introduction of the euro and whose values are expressed in BGN, will be able to be used even after the date of introduction of the euro until their expiration date or until stocks are exhausted.
I am a private trader, will the state cover my costs related to the introduction of the euro?
In the process of introducing the euro, the principle of efficiency and economy will be applied. According to this principle, the costs arising for individuals from the introduction of the euro as the monetary unit of the Republic of Bulgaria are at their expense and are not compensated with public funds.
The mere revaluation of receivables and liabilities, the servicing of bank accounts and the transition to payments in euros is not expected to lead to additional costs for the companies - clients of the banks.
What changes will occur in the preparation of the Annual Financial Report of companies?
The annual financial statements will be prepared in the currency that is in official circulation in the Republic of Bulgaria at the end of the reporting period, and the comparable data for the previous reporting period should be in the same currency.
How will accounting be done when adopting the euro?
With a view to defining a uniform accounting procedure for the transition to the euro, the future Law on the introduction of the euro in the Republic of Bulgaria and/or other normative acts will adopt normative changes related to:
With the introduction of the euro, economic and public entities should conduct their financial reporting in the new currency, and the data for the previous accounting period should be converted into euros in order to ensure comparability between the current and previous period. In the declarations and forms that citizens and legal entities will fill out after the introduction of the euro and which refer to tax and other obligations to the state or receivables from the state for the period preceding the year of introduction of the euro, the amounts will be in Bulgarian levs. However, the payments themselves based on these liabilities and receivables will be made in euros, with the amounts converted into the new currency at the official fixed exchange rate.
How will the deposits be converted from BGN to EUR?
The conversion of levs into euros on accounts with banks and other payment service providers will take place on the date of introduction of the euro. All funds in BGN in current, savings, custody and other accounts in local banks and other payment service providers will be converted into euros once and free of charge on the day of the introduction of the euro.
Will the revaluation affect the interest rate on deposits?
If the agreed interest rate on the deposit is fixed, the bank should continue to apply a fixed interest rate even after the introduction of the euro. The mechanism for transferring from a fixed interest rate in BGN to a fixed interest rate in Euro should not lead to less favorable conditions or results for the parties to the transaction - both for the client and for the bank. In this regard, the transition from a fixed interest rate in BGN to a fixed interest rate in EUR should be determined according to the bank's methodology, guaranteeing that the resulting interest payment in EUR is equivalent to that in BGN on the date of conversion.
If the deposit is agreed with a variable interest rate, this parameter will be modified in a manner regulated in the provisions of the Law on the introduction of the euro. The transition from a variable interest rate in BGN to a variable interest rate in EUR should be determined according to the bank's methodology, ensuring that the resulting interest payment in EUR is equivalent to that in BGN on the date of the conversion. Unlike cash, the conversion of which is a relatively time-consuming and logistically more difficult task, money held in bank accounts and in payment accounts with other payment service providers will be converted into euros immediately, with no transition period required. In the months before the introduction of the euro, citizens will be invited to deposit as many leva banknotes and coins as possible in bank accounts. Taking into account that all BGN funds on the accounts will be converted into Euros on the day of the introduction of the Euro, starting from that day, cashless payment transactions will be carried out exclusively in Euros.
How will loans from levs to euros be converted?
From the day of the introduction of the euro, all loans originally granted in BGN or loans with a currency clause in euro will be considered as loans in euro. It is not allowed that the revaluation be used as a condition for renegotiation of clauses of already concluded contracts between the banks and their customers or as a basis for other similar actions by the banks in relation to their customers, which would put them in a less favorable financial position compared to their position before the conversion. The same will apply to non-bank financial institutions that provide loans to customers.
The introduction of the euro does not require changes to the existing loan contracts, regardless of whether they are loans in BGN or loans with a currency clause in euros, as the question of their conversion will be regulated by the euro law. In particular, the Eurolaw will provide that the credit agreements remain in force and BGN-denominated amounts in those agreements will be considered as amounts in Euros, being converted at the official fixed rate expressed to five decimal places, and are rounded according to the rules laid down in the future Law on the introduction of the euro.
Will the revaluation affect the interest rate on loans?
If the agreed interest rate on the loan is fixed, the bank should continue to apply a fixed interest rate even after the introduction of the euro.
The mechanism for transferring from a fixed interest rate in BGN to a fixed interest rate in Euro should not lead to less favorable conditions or results for the parties to the transaction - both for the client and for the bank. In this regard, the transition from a fixed interest rate in BGN to a fixed interest rate in EUR should be determined according to the bank's methodology, guaranteeing that the resulting interest payment in EUR is equivalent to that in BGN on the date of the conversion.
If the loan is contracted with a variable interest rate, this parameter will be modified in a manner regulated by the provisions of Eurolaw. The transition from a variable interest rate in BGN to a variable interest rate in EUR should be determined according to the bank's methodology, ensuring that the resulting interest payment in EUR is equivalent to the interest payment in BGN on the date of conversion.
In this regard, the financial situation of the debtor should not be a reason for the deterioration of the interest parameters under the contract. The change of the reference interest rates from BGN to EUR should be carried out in a sufficiently justified and transparent manner, which does not aggravate the financial situation of the clients and does not lead to additional costs compared to the interest costs that the client would incur in the BGN equivalent of his obligation.
Banks and other financial institutions will have to inform their customers about the upcoming changes in advance (for example, three months) before the official switch to the euro, incl. and by disclosing its interest rate recalculation algorithm pages.
How will revaluation of securities and other financial instruments be carried out?
From the date of introduction of the euro, all government securities originally denominated in levs are automatically converted into euros. Despite the prevailing volumes of government debt in the balance sheets of banks and financial institutions, there are also other forms of debt investments denominated in BGN - mostly investments in senior and subordinated debts (bonds) issued by financial and non-financial companies on the Bulgarian market, as and investments in shares of Bulgarian companies registered in the Central Depository. The value of the investments in such securities should also be converted into Euros, including the accumulated fair value revaluation and amortization reserves of the debt instruments to date. The change in the nominal value of debt securities and shares in the central securities register is carried out by the Central Depository.
If the agreed interest rate on the securities or other financial instruments is fixed, the issuer should continue to apply a fixed interest rate even after the introduction of the euro.
The mechanism for transferring from a fixed interest rate in BGN to a fixed interest rate in Euro should not lead to less favorable conditions or results for the parties to the transaction. In this regard, the transition from a fixed interest rate in BGN to a fixed interest rate in EUR should be determined according to the methodology of the issuer of the instrument, guaranteeing that the resulting interest payment in EUR is equivalent to that in BGN on the date of the conversion.
If the securities or other financial instruments are contracted with a variable interest rate, this parameter will be modified in a manner regulated by the provisions of Eurolaw. The transition from a variable interest rate in BGN to a variable interest rate in EUR should be determined according to the methodology of the issuer, ensuring that the resulting interest payment in EUR is equivalent to the interest payment in BGN on the date of the conversion.
What happens to the collateral during conversion from BGN to EUR?
The change in the nominal value of collateral pledged/mortgaged in favor of banks and financial institutions should be automatically reflected through the register of special pledges and/or the property register. In order to protect the interests of the persons who established the collateral, no other changes in the value of the pledged/mortgaged property are allowed as a result of the automatic conversion from BGN to EUR - i.e. the replacement of BGN with EUR should not be used as a basis for change (both in the direction of increase and in the direction of decrease) in the value of the collateral.
06.03.2023
REPORTING FINANCIAL AND OTHER ABUSE
At the beginning of February of this year, the Law on the Protection of Whistleblowers or Publicly Disclosing Information on Violations, adopted by the 48th National Assembly, was promulgated.
This law regulates the conditions, order and measures for the protection of persons in the public and private sectors who report or publicly disclose information about violations of Bulgarian legislation or acts of the European Union that endanger or damage the public interest and the right of the European union, as well as the terms and conditions for submitting and considering such signals or publicly disclosed information.
The adoption of such a law was also necessary in order to comply with the law of the European Union for the introduction of the requirements of the European legislation into the national legislation.
What are the basic rights of citizens according to this new law and how can they be applied?
The purpose of the law is to ensure the protection of persons in the public and private sectors who report or publicly disclose information about violations of Bulgarian legislation or acts of the European Union, which became known to them during or on the occasion of the performance of their work or official duties or in another work context.
It is important to note that the law provides answers to a number of fundamental and key questions, such as the starting point from which the whistleblower can enjoy protection, the channels (forms) for reporting, the prohibition of retaliatory actions by the other country and other key wording.
Protection under the law applies to reports or public disclosure of information about violations of Bulgarian legislation or the acts of the European Union specified in the annex to the law in the field of public procurement, financial services, products and markets and the prevention of money laundering and financing of terrorism, transport safety, environmental protection, public health, consumer protection, protection of privacy and personal data, security of networks and information systems and others, which are detailed in the normative act.
The law also applies to reports or public disclosure of information about violations of Bulgarian legislation in the field of rules for payment of due public state and municipal receivables, labor legislation and legislation related to the performance of public service.
Whistleblowing is established by law as a personal right of the worker or employee and cannot be transferred.
In view of the possibility of quickly preventing a violation or removing the consequences of such a violation, the signal should be submitted as a priority through an internal reporting channel.
In the event that there is a reasonable assumption that the whistleblower is at risk of retaliatory discriminatory actions, and that no effective measures will be taken to verify the whistleblower, the whistleblower may be submitted through an external submission channel.
In view of the high public interest in preventing violations of Bulgarian legislation and acts of the European Union, public disclosure of information about such violations is encouraged. The persons publicly disclosing such information, in addition to the protection under this law, also enjoy the protection of free dissemination of information established in the Constitution.
Reference:
Whistleblower Protection Act
02.03.2023
UNEMPLOYMENT IN BULGARIA IS DECREASING
In the fourth quarter of 2022, the number of unemployed in Bulgaria is 128,300 people, of which 70,800 (55.2 percent) are men and 57,500 (44.8 percent) are women. Compared to the fourth quarter of 2021, the number of unemployed decreased by 18,400, or by 12.5 percent, the National Statistics Institute reported.
For the same period, the unemployment rate decreased by 0.6 percentage points and reached 3.9 percent. The unemployment rate decreased by 0.9 percentage points for men and by 0.5 percentage points for women, reaching 4 and 3.7 percent respectively in the fourth quarter of 2022.
Of all the unemployed, 14.7 percent have a higher education, 52.5 percent have a secondary education, and 32.8 percent have a primary or lower education. The unemployment rates by educational levels are respectively 1.8 percent for higher education, 3.6 percent for secondary education and 11 percent for primary and lower education.
In the fourth quarter of 2022, the long-term unemployed (or unemployed for a year or more) were 67,600, or 52.7 percent of all unemployed. The long-term unemployment rate decreased by 0.5 percentage points compared to the fourth quarter of 2021 and reached 2 percent, being higher for men (2.1 percent) than for women (1.9 percent).
Of the total number of unemployed, 17.9 thousand or 14 percent are looking for their first job.
In the fourth quarter of 2022, the unemployment rate for the 15-29 age group was 7.5 percent (7.9 percent for men and 7 percent for women), compared to the same quarter in 2021. is lower by 2.2 percentage points. The unemployment rate (15-29 years of age) decreased by 1.2 percentage points for men and by 3.6 percentage points for women.
The coefficient of economic activity for the population aged 15-64 is 74.4 percent, and compared to the fourth quarter of 2021, it increases by 2.6 percentage points.
The employment rate for the population aged 15-64 years increased by 3 percentage points compared to the same quarter of 2021 and reached 71.5 percent.
People aged 15-64 who are discouraged from finding work are 50,900, or 4.6 percent of the economically inactive in the same age group.
In the fourth quarter of 2022, total employment was 3.197 million. Compared to the fourth quarter of 2021, the number of employed increased by 3.8 percent. In the fourth quarter of 2022, the majority of the employed work in the service sector - 2.037 million, or 63.7 percent, in industry 967,200 (30.3 percent) work, and 192,600 (6 percent) in agriculture, forestry and fisheries.
Of all the employed, 3.7 percent (119,400) are employers, 7.3 percent (233,100) are self-employed without employees, 88.4 percent (2.826 million) are employed, and 0.6 percent (18 200) - unpaid family workers. Of the total number of employed, 2.208 million (78.1 percent) work in the private sector, and 617,900 (21.9 percent) in the public sector. With temporary work (for a certain period of time) are 101,100, or 3.6 percent of the employed.
The employment rate for the population aged 15-29 is 39.9 per cent, and for the population aged 20-64 it is 76.9 per cent. Compared to the fourth quarter of 2021, the employment rate (20-64 years of age) increased by 3.3 percentage points. Employed persons aged 55-64 are 628,700, or 69.4 percent of the population in the same age group. Compared to the fourth quarter of 2021, the employment rate for the 55-64 age group increased by 3.9 percentage points.
In the fourth quarter of 2022, the total number of economically inactive people (outside the labor force) aged 15 and over was 2.499 million, of which 1.014 million. (40.6 percent) are men and 1.485 million (59.4 percent) are women. The economically inactive aged 15-64 are 1.110 million (481,500 men and 629,000 women) and represent 25.6 percent of the population in the same age group. Of the economically inactive people aged 15-64, 39 percent are inactive due to participation in education or training.
02.03.2023
HOW TO GET YOUR MONEY BACK FROM UNREASONABLY PAID VIGNETTE FEES?
On the website of the National Toll Administration, www.bgtoll.bg, the application for the refund of unreasonably paid tolls has been published, which drivers who have paid more than three violations per year must submit in order to get their money back, the Road Infrastructure Agency reported.
According to the amendments to the Road Act, drivers will not be penalized for driving without an e-vignette more than three times a year. This means that if within one calendar year a vehicle has been registered three times to use the paid road network without a purchased vignette, its subsequent movement without a paid fee will not be considered an administrative violation and will not be penalized. The period provided for in the Roads Act, in which the sums must be reimbursed, is five working days.
The estimates made so far by the National Toll Administration show that about BGN 5 million will be needed to reimburse drivers for the unduly paid sums.
Another change in the Road Law is related to the correction of a wrong vignette. According to the amendments, when an error is made when issuing an electronic vignette when declaring no more than three symbols and/or a symbol is missing from the registration number of the road vehicle, including the country in which it is registered or its category, a correction is allowed by the relevant officials. In order for the correction to be made, it is necessary that the vignette is still valid and an application to change a technical error made must be submitted in accordance with Art. 10a, para. 3b of the Law on Roads by the owner or user.
When it is established that there is a vehicle in Bulgaria with a registration number identical to the one originally declared in the vignette, the applicant must present evidence of the vignette fee paid by him. The application for changing a technical error can be downloaded from the website www.bgtoll.bg.
For corrections made after February 10, 2023, the change in the data of the electronic vignette takes effect from the moment of its issuance. Its validity period is until the expiration of the period of the originally issued one. According to the adopted legislative changes, after a correction made after February 10, in the case of a wrong vignette, the owner, the registered user and the driver of the road vehicle are not penalized for violations registered during the validity period of the initially issued vignette. Also, no administrative-criminal proceedings are instituted, and those instituted are terminated. If the request is granted and the correction is made, the compensatory fee paid is refundable. In order to be reimbursed, the owner or user must submit an application for reimbursement of unreasonably paid fees. The period provided for in the Road Law Amendment Act, in which the sums must be reimbursed, is five working days.
In the case of a wrong vignette, fines and property sanctions imposed by criminal decrees or electronic receipts, as well as compensatory fees, when a correction is refused, are not refunded.
In early February, the National Assembly approved a general bill for changes to the Roads Act, which provides for a maximum of three penalties for traveling without an electronic vignette within a calendar year. The provisions providing for the imposition of a limit on fines come into effect retroactively from January 1, 2019. According to the current provisions of the Road Traffic Act, the fine for driving without a vignette is BGN 300. The adoption of the amendments came after a protest by residents of the village of Prolesha, who complained about accumulated fines for unpaid vignettes.
01.03.2023
HOW ARE WORKING SCHEDULES FORMED WHEN SHIFT WORKING?
Both shift work and the cumulative calculation of working time are genetically related to the distribution of working time, which is established by the rules for the internal work order in the enterprise. Therefore, the alternation of shifts, as well as the cumulative calculation of working hours, are also regulated in the rules for the internal work order. This regulation is a necessary legal condition for establishing a cumulative calculation of working time. In addition, simultaneously with the establishment of a cumulative calculation of working hours, the employer "endorses nominal schedules" for the periods of its calculation, which are stored for at least 3 years and kept at the disposal of the control authorities of the places where the work is performed.
In order to establish a summary calculation of working time, an order of the employer is necessarily required, with which he determines the period of his reporting and approves the nominal work schedules of the employees, which are attached to the order. In the absence of an order and a confirmed schedule, the control authorities assume that the working hours are daytime, which in terms of insurance is associated with interruption of insurance during the holidays, coinciding with the calendar working days in the month and loss of insurance rights.
Where it is necessary to carry out the work on a schedule on certain days of the month, in order to avoid interruptions in provision and restrictions on daily working hours with the resulting adverse consequences, it is more expedient to conclude an employment contract with suitable daily working hours, according to employment according to the schedule and the reporting period, to be approved by order and this to be regulated in the rules for the internal work order in the enterprise.
In the case of cumulative calculation of working hours, the schedules are drawn up by the employer according to the economic needs of the enterprise, provided that the legally established regime of work and rest and the norm of regular working hours determined by the employment contract for the reporting period are observed.
The regime of work and rest in the case of cumulative calculation of working time requires compliance with the maximum duration of the work shift, which in case of cumulative calculation of working time can be up to 12 hours, and in the case of reduced working time - up to 1 hour above it. The maximum duration of the working week cannot be more than 56 hours, the inter-day rest cannot be less than 12 hours, and a continuous weekly rest cannot be less than 36 hours (when changing shifts, when the actual and technical organization impose this – 24 hours). It is also required to observe the ban on assigning work in two consecutive shifts.
In the case of cumulative calculation of working time, "actual time worked" is calculated after the end of the reporting period, and the hours worked (after converting them from night to day) are divided by the agreed daily working time - full or part time.
When the reported working time exceeds the norm of the agreed working time for the reporting period, there is overtime work, which is kept in a special book for this purpose and is reported every six months to the labor inspectorate. Overtime is paid with an increase of not less than 50 percent.
Reference:
Art. 139, Art. 142, Art. 157, Art. 262, Art. 403a of the Labor Code
Art. 4a Regulation on working hours, breaks and vacations
01.03.2023
EC FORECASTS FOR BULGARIA: GDP GROWTH OF 1.4% AND INFLATION OF 7.8% FOR 2023
Despite high inflation, economic activity continued to expand in 2022, supported by robust export growth and increases in wages and social transfers that offset rising consumer prices. Still, private consumption growth slowed in the first half of the year as inflation picked up. However, consumer demand is assumed to have strengthened in the second half of 2022 due to continued growth in disposable income combined with some slowdown in monthly inflation dynamics. This is recorded in the winter forecast for 2023 of the European Commission for Bulgaria.
The downward trend in fixed capital investment that began in 2021 has continued in 2022. Rising prices of capital goods, both in construction and equipment, are likely to have dampened new investment. Overall, the European Commission expects real gross domestic product (GDP) to have increased by 3.9% in 2022.
Real GDP is expected to grow by 1.4% in 2023 and by 2.5% in 2024.
The path of the economy is expected to depend largely on the interaction between wage growth and prices. Short-term indicators and inflation data suggest that inflation will decline only gradually over the forecast horizon as service price inflation continues. In a tight labor market, wages are expected to continue to grow strongly and support household consumption. The rapid increase in exports in 2022 was supported by the opportunity to meet supply shortages of food products, metals and other materials caused, among other things, by Russia's war of aggression against Ukraine.
Export growth is forecast to slow significantly in 2023, given that the drivers for further expansion of export market share were largely exhausted in 2022. In 2024, exports are expected to pick up in line with external demand. Increased absorption of EU funds, in particular the Recovery and Resilience Plan, is expected to support aggregate investment in both 2023 and 2024. Potential delays in the implementation of the Recovery and Resilience Plan pose a downside risk to investment growth.
Average inflation according to the Harmonized Index of Consumer Prices (according to Eurostat standards)
reached 13% y/y in 2022 with a strong contribution from energy and food price inflation. Service price dynamics are driven by transportation and restaurant services that rely on energy and/or food as direct inputs. Towards the end of the year, inflation spread to other services in line with rising unit labor costs. Overall, Harmonized Index of Consumer Prices inflation is expected to ease from 13% in 2022 to 7.8% in 2023 due to lower energy prices. In 2024, headline inflation is expected to slow further to 4% as food price dynamics weaken. Service price inflation is expected to persist over the forecast horizon.
Compared to the autumn forecast
The European Commission raises its GDP growth expectations from 1.1% in the autumn forecast to 1.4% in the winter forecast, and for inflation, it forecasts an increase in consumer prices from 7.4% to 7.8% in 2023.
28.02.2023
HOW TO SAVE WITH INFLATION?
Rising prices and economic uncertainty in recent months have many people worried. In these conditions, instead of panicking, the more forward looking are looking for different ways in which they can optimize their spending, preserve the value of their money and cope with the situation without radically changing their lifestyle. For them, the team of the Bulgarian financial site Tvoitepari.com has selected seven easy-to-implement tips that can help minimize the effects of inflation.
Buy used or rent
There are often great deals on resale or bulk shopping sites that can save us a ton of money without sacrificing quality. Books, toys, sports equipment, furniture, clothes and accessories ... we can find all this many times cheaper. There are also cases in which it makes more sense to rent - for example, skis, tools or equipment that we will not need in the long term. Or a formal suit that we will only wear once. So with a small investment, we will save a lot.
Cook at home
Cooking at home saves a lot of money. Even if you are not a chef, today there are many apps that will literally show you step by step how to prepare a dish. In the store, look for products that are further reduced. More and more stores offer special sections with food that is perfectly good, but is about to expire or has damaged packaging.
Another way to save is instead of buying coffee from the cafeteria, make it at home and take it in a thermos. Remember - small expenses that we make regularly every day can turn out to be an important factor in spending money. And one bonus of cooking at home – you control the calories, and the leftovers can be taken as lunch the next day.
Urban agriculture
If you have a large balcony, yard or cottage, why not make your own garden. Today there are decorative varieties of tomatoes, cucumbers, peppers suitable for urban conditions. The feeling of growing your own from a seed is so inspiring. In addition to saving money, this way you reduce the harmful emissions that would otherwise be generated by transporting the products, and last but not least, you and your family will feel much more connected to the food you have grown.
Reduce digital subscriptions
Do you really need all the streaming apps and paid "cloud" platforms? These are recurring subscriptions that add costs to your budget each month. To save some money, you can limit the number of apps you pay for and optimize their usage. So, for example, today you can watch the movies from one streaming channel, and after a month you can unsubscribe and sign up for another service.
Travel in the off season
Tightening your seat belt doesn't mean saying goodbye to your travel plans. Be creative. If you have children who go to school, you will have limited vacation time. If not, you can avoid the crowds and take advantage of off-season deals. This means a more relaxed and cheaper holiday. There are other ways to save money on travel. For example, instead of a hotel, you might stay with locals or look at cheaper options on home-sharing platforms.
Barter and trade
If you need an appliance and you have one that you don't use, why not try to trade them. There are many barter groups on social networks, take advantage and save.
Reduce transportation costs
If you don't have convenient public transportation nearby, a car is essential. But there are still ways to save on fuel costs. If conditions allow, consider an electric scooter, bike or carpool. Instead of shopping at the store by car, go on foot. An added bonus - it's good for your health, the environment and the local economy.
Here are some tricks to save money on fuel:
reduce your speed on the highway;
avoid sudden starts and stops;
turn off the air conditioner;
make sure the tank is full;
keep your tires inflated;
check your engine oil level.
28.02.2023
GREECE IS EXPECTING A STRONG TOURIST SEASON, BUT THERE ARE NO WORKERS
Greece expects a very strong tourist season, but cannot find enough workers. A total of 80,000 is not enough for hotels and restaurants.
An unexpected increase in bookings already in the first month of this year, reports the Greek Ministry of Tourism.
The Ministry of Tourism indicated a forecast for a 20% increase in tourists this year compared to the successful year 2019. The government allocates 350 million euros for hotel renovations, infrastructure in tourist areas and advertising.
The season will open as early as March, with 18 billion euros in revenue expected this year.
Early bookings point to a very strong season, and in terms of prices, no sharp increase is expected, experts emphasize. A new campaign to popularize the Greek summer has also been launched, the Minister of Tourism said.
There is increased interest from all European countries, and Northern Greece traditionally relies on tourists from the Balkans.
There is a shortage of workers in the tourism sector and hoteliers are demanding that the government provide 30,000 workers from abroad.
