21.12.2022
WHAT ARE EUROPEANS' EXPECTATIONS FOR INFLATION AND INCOMES
Consumer expectations for the rate of inflation over the next 12 months rose from September, while they remained unchanged for the next 3 years, the European Central Bank (ECB) said in its October 2022 survey of consumer sentiment.
The aggregate level of expectation is for inflation to grow by 5.4 percent over the next 12 months, while in the previous period consumers' expectations were for an increase of 5.1 percent. As for its growth over the 3-year period, expectations remain unchanged at 3 percent. Uncertainty about the rate of inflation over the next 12 months has increased significantly since the start of the war in Ukraine, the ECB reports.
Consumer expectations for growth in spending and income in nominal terms over the next 12 months are rising. Expected growth in spending continues to outpace that of income.
Consumers expect their nominal incomes to rise by 0.7 percent in this period, while in September their forecasts were for an increase of 0.6 percent. In terms of their nominal spending, consumers expect them to increase by 4.5 percent over the next 12 months, compared to a forecast in September for growth of 4.7 percent.
Expectations for the rate of economic growth over the next 12 months are falling (from -2.4 per cent in September to -2.6 per cent in October), while consumers are predicting that unemployment growth will increase over this period. Expectations increase to 12.5 percent from 12.2 percent in September.
Consumers expect the market price of their homes to increase at a slower rate over the next 12 months. In October, the forecasts were for a price increase of 3.0 percent, while in September they were for a price increase of 3.4 percent.
Consumer expectations are for a continued increase in mortgage interest rates to an average level of 4.7 percent.
20.12.2022
PARAMETERS FOR THE CONSTRUCTION OF RES FOR OWN CONSUMPTION UNDER THE NATIONAL PLAN FOR RECOVERY AND SUSTAINABILITY
Comments and proposals on the parameters can be submitted until 12.01.2023
The Ministry of Innovation and Growth presented for public discussion the documents and application guidelines under procedure BG-RRP-3.006 - "Construction of new RES for own consumption in combination with local energy storage facilities in enterprises".
According to the published information, proposals and comments can be submitted until 12.01.2023 in the information system for management and monitoring of EU funds in Bulgaria HERE.
The total amount of the grant is BGN 200 million, and the funds are distributed proportionally depending on the size of the enterprises and the sectors in which they operate:
The minimum and maximum amount of grant funding for a specific proposal for the implementation of an investment is from BGN 100 thousand to BGN 1 million, and the maximum amount of requested grant funding for an investment should not exceed the applicant's average annual net sales revenue for the three-year period 2019, 2020 and 2021, respectively:
The duration of implementation of any investment proposal should not exceed 18 (eighteen) months, counted from the date of entry into force of the financing contract with the final recipient.
Additional restrictive conditions are provided in relation to the intensity of the grant funding and depending on the geographical location of the implementation of the investment:
Who can apply?
o Micro-enterprises: ≥ 80,000 BGN
o Small enterprises: ≥ BGN 187,000
o Medium enterprises, small companies with an average market capitalization and companies with an average market capitalization: ≥ BGN 750,000
Mandatory conditions that activities must meet in order to be funded:
What are the intended eligible activities?
Construction of new photovoltaic installations up to 1 MW for the production of energy from renewable sources for self-consumption in combination with local energy storage facilities (batteries).
The investment should be maintained by the end recipient in the property where it was originally built for at least 5 (five) years from the final payment. For the specified period, the obligation to use the energy produced by the new photovoltaic installations only for own consumption, including the facilities for local storage of the produced energy (batteries), should also be observed.
The investment should be insured against theft, intentional acts of third parties, fire and other natural disasters and other relevant risks for the period from commissioning to a minimum of 5 (five) years from the final payment.
What expenses will be recognized?
Costs for building a photovoltaic system up to 1 MW for own consumption in combination with facilities for local storage of the produced energy (batteries).
The scope of eligible expenses may include: expenses for the acquisition of durable tangible assets; costs of acquisition of fixed intangible assets; costs for construction and installation of roof/facade/adjacent property; and costs for consulting services of an engineering-technical nature. All stated costs should be necessary and directly related to the built photovoltaic systems in combination with batteries.
All investment costs must be incurred by one contractor (legal entity).
The costs for construction and installation work are only permissible insofar as they are directly related to the realization of the construction of a photovoltaic system combined with facilities for local storage.
Under the procedure, only new photovoltaic installations in combination with batteries (in their entirety) are financed, not new components /separate parts/ with which to replace elements of existing and already built photovoltaic systems and/or batteries.
Please note that interested parties can review the documents and requirements presented for discussion and give their suggestions and comments until January 12, 2023.
20.12.2022
ILO: THE INCREASE IN WAGES DOES NOT LEAD TO AN INCREASE IN INFLATION
A severe inflationary crisis combined with a global slowdown in economic growth – partly caused by the war in Ukraine and the global energy crisis – is leading to a staggering drop in real monthly wages in many countries.
According to a new report by the International Labor Organization, the crisis is reducing the purchasing power of the middle class and hitting low-income households particularly hard.
The "World Wage Level Report 2022-2023: The Impact of Inflation and COVID-19 on Wages and Purchasing Power," as the document is called, shows that in the first half of 2022, monthly wages worldwide were decreased in real terms to minus 0.9% – for the first time in this century, real wage growth worldwide has been negative.
“In 2022, the gap between labor productivity and real wages will be the largest in over 20 years. Labor productivity has been strongly positive for many years, but incomes have stagnated as governments refuse to curb corporate greed, and in many countries the rights to collective bargaining and freedom of association are weakened... The world must no longer tolerate economic policies that is dictated by discredited academic theory of those economists and politicians who refuse to face reality. The world needs a new social contract, at the center of which are jobs and decent pay."
This was stated by the Secretary General of the International Labor Confederation, Luca Visentini, categorically denying the theories launched by some economists and central bankers that wages cause inflation and therefore their growth should be limited.
Estimates among advanced G20 real wages in the first half of 2022 fell to minus 2.2%, while real wages in emerging market G20 countries rose 0.8%, which is 2.6% less than in 2019, the year before the COVID-19 pandemic.
“The multiple global crises we are facing have led to a decline in real wages. This has put tens of millions of workers in dire straits as they face increasing insecurity," said ILO Director-General Gilbert F. Hungbo.
"Income inequality and poverty will increase if the purchasing power of the lowest paid workers is not maintained. In addition, much-needed post-pandemic recovery may be at risk. This could fuel further social unrest around the world and undermine the goal of achieving prosperity and peace for all.”
The cost-of-living crisis adds to the significant wage losses for workers and their families during the COVID-19 crisis, which in many countries has had the greatest impact on low-income groups.
The report shows that rising inflation is having a greater impact on the cost of living for people on low incomes. This is because they spend most of their disposable income on essential goods and services, which generally experience higher price increases than non-essentials.
The report states that inflation also reduces the purchasing power of minimum wages. Estimates show that despite nominal adjustments, accelerating price inflation is rapidly reducing the real value of minimum wages in many countries for which data are available.
According to the analysis, there is an urgent need to implement well-designed policy measures to help preserve the purchasing power and living standards of wage workers and their families.
Adequate adaptation of minimum wage rates could be an effective tool given that 90% of ILO Member States have minimum wage systems in place. Strong tripartite social dialogue and collective bargaining can also help achieve adequate wage adjustments in times of crisis.
Other policies that can ease the impact of the cost-of-living crisis on households include measures targeted at specific groups, such as providing low-income households with vouchers to help them purchase essential goods, or reducing the value added tax on these goods to reduce the burden that inflation places on households while helping to bring down inflation.
"We need to pay special attention to workers at the middle and bottom of the wage scale. Combating the deterioration in real wages can help sustain economic growth, which in turn can help restore employment levels seen before the pandemic. This can be an effective way to reduce the probability of recessions in all countries and regions", stated Rosalia Vázquez-Álvarez, one of the authors of the report.
The report, which includes regional and country data, shows that in the first half of 2022, inflation rose proportionally faster in high-income countries than in low- and middle-income countries, resulting in the following regional trends in real wages:
- In the European Union, where job preservation schemes and wage subsidies have largely protected employment and wage levels during the pandemic, real wage growth has picked up to 1.3% in 2021 and has fallen to minus 2.4% in the first half of 2022;
- In Eastern Europe, real wage growth has slowed to 4.0% in 2020 and 3.3% in 2021, falling to minus 3.3% in the first half of 2022;
- In North America (Canada and the United States), average real wage growth fell to zero in 2021 and fell to minus 3.2% in the first half of 2022;
- In Latin America and the Caribbean, real wage growth has slowed to minus 1.4% in 2021 and to minus 1.7% in the first half of 2022;
- In Asia and the Pacific, real wage growth rose to 3.5% in 2021 and slowed in the first half of 2022 to 1.3%. When China is excluded from the calculations – given the country's heavy weight in the region – real wage growth increased by much less – 0.3% in 2021 and 0.7% in the first half of 2022;
- In Central and West Asia, real wage growth rose strongly to 12.4% in 2021, but slowed to 2.5% in the first half of 2022;
- In Africa, data points to a drop in real wage growth to minus 1.4% in 2021 and a drop to minus 0.5% in the first half of 2022;
- In Arab countries, wage trends are tentative, but estimates point to low wage growth of 0.5% in 2021 and 1.2% in 2022.
20.12.2022
€1.39 BILLION FOR ROMANIA UNDER THE REPOWEREU PLAN
Romania will benefit from 1.39 billion euros under the REPowerEU plan to reduce energy dependence on the Russian Federation, Romanian MEP Siegfried Muresan (European People's Party/National Liberal Party) announced, Digi 24 TV reports.
The European Parliament and the Council of the EU have agreed on the final form of the REPowerEU plan, which will allow member states to access a total of €20 billion for energy investment.
Romanian MEP Siegfried Muresan, who is one of the three co-rapporteurs of the European Parliament on the Recovery and Resilience Mechanism and the REPowerEU plan, said at the end of the meeting that the outcome of the negotiations was beneficial for Romania.
"The best news is that we managed to reach an agreement on the REPowerEU plan before the end of the year, as we had promised. This means that REPowerEU will enter into force at the beginning of next year," Mureşan pointed out, specifying that the amount from which will benefit Romania, amounting to EUR 1.39 billion The funds will be used for investments in energy efficiency, reducing dependence on gas imports from Russia, improving energy infrastructure and investing in renewable energy sources.
Mureşan explained that through this new fund, around 20 billion euros are made available to help member states, people, businesses and regions facing the consequences of the crisis caused by the Russian invasion of Ukraine.
The Romanian MEP recalled that the grants under the REPowerEU plan will be added to the approximately 30 billion euros that Romania already receives under the National Recovery and Resilience Plan within the European Recovery and Resilience Mechanism.
The agreement between the European Parliament and the Council of the European Union provides that all member states will receive 20 percent of upfront funding when the European Commission and the Council of the EU approve the new REPowerEU pillars of the recovery plans. It also provides for retroactive funding of energy investments from February 2022, when the Russian Federation invaded Ukraine.
"This is very good news for Romania and the other member countries, which had to take a number of measures to reduce their energy dependence on the Russian Federation. The agreement we reached gives the member states more funds for investment projects in the field of energy security than the very beginning and allows them to cover the costs incurred in the past in the context of the invasion of the Russian Federation in Ukraine, through REPowerEU," said Siegfried Muresan.
The agreement foresees that the remaining unused funds from the Recovery and Sustainability Mechanism - about 200 billion euros - can be used by countries that want to invest more in energy projects. Thus, Member States that have not yet accessed the full credit component of their national recovery and resilience plans will have only 30 days from the entry into force of REPowerEU to notify the European Commission of their intention to access these means. If they do not intend to take advantage of these funds, the countries concerned will lose the advantage of accessing funds from the credit component.
Siegfried Muresan said that for Romania this is very important news, as the country has already announced its intention to access all credits.
The agreement must be formally ratified by the Council of the European Union and voted by the European Parliament to become European law and for REPowerEU to officially enter into force.
The REPowerEU plan aims at a series of measures to rapidly reduce Russia's dependence on fossil fuels and accelerate the environmental transition, while increasing the resilience of the European Union's energy system.
20.12.2022
HOLIDAYS AND WORK: HOW IS HOLIDAY WORK PAID?
For the upcoming holidays, the Executive Agency "Main Labor Inspectorate" reminds workers and employees who will work that they must receive a minimum of double wages for work on a public holiday. The amount of pay is quadrupled if the work on these days is also overtime, as it is also paid with a 100% increase.
According to the Labor Code, public holidays are December 24, 25 and 26, as well as January 1. Their coincidence with Saturdays and Sundays extends the days off with the so-called non-attendance days, which is why there will be rest on December 27 and 28 for Christmas, and on January 2 for New Year's. Work on a non-attendance day is paid as on a holiday, i. e. with an increase only for overtime work and that by 75%.
For those working on an irregular working day or on a day-by-day calculation of working hours, work on holidays, weekends and days of absence is overtime. It must be assigned by the employer with a special order issued at least 24 hours earlier.
In the aggregate calculation of working hours, when scheduled work is performed on holidays, it is not overtime. In these cases, only double wages are paid for work on public holidays.
The Labor Inspectorate advises employees who will work during the holidays not to trust verbal agreements with employers. In order to be able to protect their rights, they must have written proof that they worked on holidays and non-attendance days, such as an overtime order or a named work schedule.
19.12.2022
HOW TO CLAIM CHILD TAX BENEFITS
Until the end of December, parents of children and children with disabilities can benefit from tax relief through their employer in the main employment relationship. For this purpose, they must submit the relevant declaration to him by December 31 of this year. In this case, the employer can reimburse them until the end of January 2023 the withheld tax for 2022, the NRA states.
The calculation of the amount to be received is based on the taxable income of the parents in 2022, and they will receive up to BGN 600 for one child, up to BGN 1,200 for two and up to BGN 1,800 for three or more children. For raising one disabled child, the reduction for this year on the annual tax base is in the amount of BGN 12,000, with the amount to be received being up to BGN 1,200.
Parents of children with 50 and with more than 50% disabilities are entitled to use both tax benefits. For example, for raising a child who is disabled, the parent has the right to tax relief for children in the amount of BGN 6,000 (amount to receive up to BGN 600) and to tax relief for children with disabilities in the amount of BGN 12,000 (amount for receiving up to BGN 1,200). The two tax reliefs are added together, so their total amount can reach up to BGN 18,000 (amount to receive up to BGN 1,800).
In addition to an employer, tax relief can also be enjoyed by submitting an annual tax return to the National Revenue Agency within the period from January 10 to May 2, 2023, and the sums of money will be refunded after verification by the revenue agency within 1 month after the submission of the declaration.
Individuals, including sole traders, who have no income in 2022 or have received non-taxable income, such as maternity and unemployment benefits for example, as well as people with only income subject to final and/or patent tax, cannot benefit from reliefs, but this can be done by the other parent, the NRA reminds.
In the event that the amount of taxable income of one parent is not sufficient for the use of the full amount of the tax relief, the other parent can submit a declaration to the National Revenue Agency for the use of the remainder of the tax relief. The tax relief can also be used for a child who has reached the age of majority or was born in 2022.
One of the most important requirements for the application of the reliefs is that the persons do not have public obligations subject to enforcement. The NRA advises citizens to check their tax account online for liabilities with a personal identification code before using tax relief to avoid inconvenience.
The conditions for using the tax relief for children and children with disabilities are described in detail on the NRA website and the department's Facebook page. Consultations on these issues can be made with the Information Center of the NRA on phone: 0700 18 700 and email: infocenter@nra.bg.
19.12.2022
REGISTERED UNEMPLOYMENT REMAINED AT A RECORD LOW FOR NOVEMBER
The Employment Agency reported a level of registered unemployment in the country of 4.4% in November. This is the lowest value of the indicator for this month since the existence of the institution's administrative statistics. The year-on-year dynamics also continues to show a decline, which for this November is 0.4 percentage points.
At the end of the month, the registered unemployed at the labor offices totaled 145,431, which is an increase of 3,444 persons more than those reported in October.
During the month, 23,744 new unemployed were registered. They are 1,738 less than the previous month and 906 less than those registered in November 2021. Another 609 people from the groups of jobseekers employed, students and pensioners also registered at the labor offices during the month.
There were 11,416 unemployed people who started work in November. 255 persons from the groups of pensioners, students and the employed also found work through the labor offices. During the month, the largest share of those who started work in the processing industry sector - 19.2%, followed by those in trade - 13.4%, hotels and restaurants - 6.1%, state administration - 5.3%, construction - 5.8% and others.
787 unemployed people from the risk groups were appointed to subsidized jobs during the month - 267 under employment programs and measures and 520 - under schemes of the Operational Program "Human Resources Development".
During the month, 377 unemployed and employed persons were included in various trainings, and 664 completed the training started in previous months, acquiring a new profession or key competence.
Claimed jobs on the primary labor market in November were 8,439. Most vacancies in the real economy were claimed in manufacturing (28.9%), followed by trade (13.6%), government (10.2%); education (8.1%), hospitality and catering (7.7%) and administrative and auxiliary activities (7.0%).
The most sought-after professions by businesses during the month are: machine operators of stationary machines and equipment; sellers; personal care staff; personnel employed in the field of personal services; workers in the mining and processing industries, construction and transport; skilled workers in the production of food, clothing, wood products and related; drivers of motor vehicles and mobile equipment; waste collection and related workers; teachers; metallurgists, machine builders and their relatives and craftsmen, etc.
19.12.2022
THE NEED FOR WORKERS AND SPECIALISTS IS NOT DECREASING
The second survey for 2022 by the Employment Agency on employers' labor needs indicates that, despite a series of crisis factors, the need for workers and specialists is not decreasing.
This is shown by the results obtained from the nationally representative survey, which covers 378,675 active enterprises in the country. And this time, the Employment Agency collects employer attitudes with the active assistance of the Employment Commissions of the 28 Regional Development Councils.
The collected data indicate that in the next 12 months the business will need 205,548 workers and specialists with skills and knowledge in various professional fields. This is up 6.1% or nearly 12,000 more than the previous year. 45,820 are the companies that say they will be looking for new staff in the next year. Compared to the survey in September - October 2021, their number decreased by 1,136 or by 2.8%.
Over the next 12 months, employers will be looking for 111,040 professionals with qualifications gained in vocational training and education. The most sought after will be: tailor, machine operator, builder, cook, woodworking operator, waiter-bartender, welder, operational accountant, food industry worker, locksmith, etc.
Bulgarian business will need another 45,954 specialists with legal capacity or higher education. Driver, teacher, nurse, and doctor continue to occupy the top spot among the most sought after by employers for specialists in occupations that require a higher education or legal qualification. Compared to the previous year, the number of graduates in demand increased by 2,244 or by 5.1%. In addition, 48,554 workers without a specialty will be needed in the various sectors of the economy in the next 12 months, and their number compared to a year earlier is nearly 7,000 more.
According to the study, in the medium term, i.e. in the next 3 to 5 years, the sought-after specialists with a higher education will be 123,284 people or 4.3% of those employed on a labor and service basis at the end of September 2022.
The most sought after specialists will be the graduates of the following majors: Pedagogy, Medicine, Economics, Informatics and Computer Science, Electrical Engineering, Electronics and Automation, Mechanical Engineering, Administration and Management, Communication and Computer Engineering.
In the next 3 to 5 years, Bulgarian business will also need 148,485 specialists with secondary education. The demand for specialists with secondary education will most often be in the fields of wholesale and retail trade, construction, engineering, metalworking and metallurgy, as well as accounting and taxation.
Plovdiv is the area where the largest number of workers and specialists are expected to be hired - 24,720, which is 12.0% of all the needs declared in the country.
In 16 regions, there was an increase in the stated needs of labor compared to a year earlier. The need for workers and specialists increased most significantly in the Stara Zagora region - 2.4 times. The following are the regions of Silistra – 2.2 times, Varna – 1.9 times, Kyustendil – 1.8 times. At the other extreme are the regions of Pleven, Yambol and Vidin, where the needs will almost double compared to 2021.
In the study of employers' needs, enterprises with different numbers are proportionally covered - from micro-enterprises with less than 10 employees to large enterprises with more than 250 employees. According to the economic activity, the largest share of surveyed enterprises from the "Trade, transport, hotel and restaurant" sector (37.4%), followed by the enterprises in the "Public administration, education, humanitarian healthcare" sector with 15.4% representation, and in third place is the "Industry" sector with 13.2%.
The labor force needs survey is conducted by the Employment Agency twice a year in order to collect and analyze up-to-date information on the professions, competencies, knowledge and skills of the personnel sought by employers and to plan measures to organize their professional training.
From next year, the survey will be conducted once a year. This regulates a change in the Law on Promotion of Employment from June 2022. The methodology and procedure for its implementation will be determined in the Regulations for the Implementation of the Law on Promotion of Employment, which is yet to be adopted.
16.12.2022
THE PLANNING OF NEW INDUSTRIAL ZONES WILL HAVE A SPECIAL FOCUS ON NORTHWESTERN BULGARIA
The planning of new industrial zones will have a special focus on Northwestern Bulgaria. This was announced by the Minister of Economy and Industry, Nikola Stoyanov, during a conference on the topic of Potential and Development of Vratsa and the Region, which was held in the city. According to him, about BGN 200 million in financing for the construction of industrial parks will be provided only under the National Recovery and Resilience Plan, and these locations are a tool for attracting investments in the regions.
The municipality of Vratsa has a serious potential for the development of industrial parks, and the identified over 10 plots are an excellent location for investors of any scale and with diverse activities, Nikola Stoyanov pointed out. He added that the Memorandum of Cooperation between the National Company Industrial Zones and the municipality of Vratsa will be renewed as soon as possible, which is a good basis for partnership and for attracting more investors to the region.
The data shows that after the covid pandemic, the economy in the district has already started its steady upward growth. This is confirmed by the growing number of employed persons in the Vratsa region, which from the beginning of 2021 to September 2022 increased by more than 11 thousand people, Stoyanov also said. According to him, these numbers are a sign of economic awakening in the area, but important issues related to employment and wages in this region are still on the agenda.
According to the Minister of Economy, in recent years the municipality of Vratsa is an example that with proactive actions and a lot of work, the region can become one of the positive examples for Northwestern Bulgaria. Proof of this is the fact that by the end of 2020, direct foreign investments in the region will exceed 120 million euros, added Stoyanov.
16.12.2022
BULGARIA RECEIVED ALMOST 1.4 BILLION EUROS UNDER THE RECOVERY AND RESILIENCE PLAN
The European Commission today made the first payment of grants in the amount of 1.37 billion euros to Bulgaria, after Bulgaria met 22 key milestones and targets related to the National Recovery and Resilience Plan. They cover important first steps in reforms and investments to decarbonise the energy sector, the large-scale deployment of digital infrastructure, reforming the judiciary, strengthening the anti-money laundering framework, digitizing the public sector, improving compliance and the coverage of the Minimum income. Measures are also included to ensure that the audit and control system for the implementation of the Recovery and Resilience Facility meets European standards.
Context
As for all other EU member states, payments under the Recovery and Resilience Facility - the main instrument of NextGenerationEU - are performance-based and dependent on the implementation of the investments and reforms in Bulgaria described in its Recovery and Resilience Plan.
On 31 August 2022, Bulgaria submitted to the Commission a first request for the payment of EUR 1.37 billion under the Recovery and Resilience Mechanism, covering 22 key milestones and targets. On November 7, 2022, the Commission adopted a positive preliminary assessment of Bulgaria's request for payment. The positive opinion of the Economic and Financial Committee of the Council on this payment request paved the way for the Commission to take a final decision on the disbursement of the funds today.
Overall, Bulgaria's recovery and resilience plan will be financed with 5.69 billion euros in grants. The amounts of payments made to Member States are published in the Recovery and Resilience Indicator Set, which shows the progress made in implementing the Recovery and Resilience Facility as a whole and the individual Recovery and Resilience Plans.
